ECC approves financial restructuring of Heavy Electrical Complex

ISLAMABAD: Economic Coordination Committee of the Cabinet (ECC) on Tuesday approved financial restructuring of Heavy Electrical Complex, extension and issuance of GOP guarantee for PIAC loans.The ECC met here under the chairmanship of Federal Minister for Finance, Dr. Abdul Hafeez Shaikh also discussed the other agenda items at length and deferred for further deliberations in the next meeting.The agenda items include procurement of wheat by public sector institutions, increase in the rate of cotton cess, ex-post facto approval of additional charges for distribution of imported urea from Gawadar Port and state trading in grain.The Privatization Commission in its summary to the ECC had sought the loan availed by the HEC to be converted into government equity before its privatization.Earlier the Finance Division has supported the proposal for conversion of loans payable by the company in GOP equity.

The summary for the issuance of government guarantee for issuance of PIAC loans was moved by Defence Division in which it was proposed that continuing guarantees in respect of all the loans may be issued by the Ministry of Finance and roll-over of them may be approved on yearly basis or for the term of the loan.It may be mentioned here that Finance Division has already endorsed renewal/extension of GOP guarantees for the PIAC loans for two years from different banks.At the start of the meeting the ECC was given a detailed presentation on the key economic indicators which highlighted the review of price situation, inflation and its drivers, review of stock position, latest economic indicators, commodities stock situation of what, sugar and fertilizers, large scale manufacturing, current account deficit, foreign exchange reserves, workers’ remittance and direct foreign investment.

The ECC also asked the Federal Minister for Food and Agriculture to have review on the proposal for curtailing the strategic reserve of wheat should be one million ton from three million tons in light of the wheat procurement of 6.57 million tons.In this regard he suggested to have another session on this matter and consult the provinces also for which the Federal Minister for Food and Agriculture would convene a meeting of the Deputy Chairman Planning Commission, Secretary Food & Agriculture, Provincial Ministers for Agriculture and representatives of the Finance Division.The meeting would deliberate upon the suggestion of the Federal Finance Minister that under the devolution plan agriculture as a subject shall be devolved to the provinces, thus determining the size of the strategic reserves of wheat should also be decided at the provincial level, or if the same is left to the Federal Government, the Ministry will determine the criteria for setting the strategic reserve of wheat.Later the Federal Minister for Finance chaired the Cabinet Committee on Privatization which approved the Capital Market listings of the Exchangeable Bond – APP