The Federal Government of Pakistan recently approved Rs. 23 billion for the supply of cheaper electricity to five major export sectors by withdrawing funds from the Public Sector Development Programme (PSDP).
The Economic Coordination Committee (ECC) also approved Rs. 20 billion for the five export sectors which will be allocated from the budget of the next fascial year. The decision was made during the recent ECC meeting in the presence of Advisor to Prime Minister on Finance and Revenue Dr. Abdul Hafeez Shaikh.
Speaking at the meeting, the Ministry of Finance said,” The ECC approved a proposal by the Power Division for a special relief package to further continue provision of subsidized electricity until June 2020 to five export-oriented sectors.”
According to the Finance Ministry, the Power Division proposed that out of the Rs. 23 billion, an amount of Rs. 14 billion would be diverted from the original subsidy allocation of Rs24 billion for cheaper gas supply to industries. The remaining Rs. 9 billion will be provided through savings in the PSDP. The ECC approved the subsidy arrangement, which also indicated that the Pakistan Tehreek-e-Insaf (PTI) government would not be able to fully utilize the Rs. 701 billion PSDP.
Planning Minister Asad Umar committed to ensuring the entire spending of Rs. 701 billion in the current fascial year.
Furthermore, ECC postponed the decision of increasing the wheat price of another Rs. 35 to Rs. 1,400 per 40kg. Another meeting will be conducted regarding the wheat prices as the committee rejected the proposal of the Ministry of National Food Security’s proposal to fix the support price at Rs. 1, 400.