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ECC approves three months` salary for Steel Mills staff

By Khaleeq Kiani 2016-11-11
ISLAMABAD: The Economic Coordination Committee (ECC) of the cabinet on Thursday approved three months` salary of employees of the Pakistan Steel Mills and rollover of Rs136.5 billion loan for power sector but rejected an incentive package proposed for a motorbike manufacturer.

At the ECC meeting a proposal for an incentive package for the Yamaha Motor Company for its new motorcycle model was criticised so vehemently by Finance Minister Ishaq Dar that the ministry of industries and production was forced to withdraw its summary, according to sources.

They said the ministry wanted that an incentive package reserved for `new entrants` to the market be approved in the case of Yamaha motorcycles for a plant the manufacturer was in the process of setting up.

The minister recalled that he had seen Yamaha motorcycles on the country`s roads since his childhood and wanted to know why its new plant should be treated as a`new entrant` facility.

Mr Dar said a new policy could not be formulated on the basis of proposals for a single party. He observed that the ECC had already approved theautomotive policy for new entrants and it was now up to the ministry and the engineering development board to determine if the new plant fell in the `new entrant` category.

The meeting was told that Yamaha was introducing 150cc motorbikes in the country through a brand-new plant, which was to be equipped with technology not currently available with any other vendor operating in Pakistan.

The finance minister was not satisfied because, according to him, the bike operator already has variants like the 70cc, 100cc and 125cc models in the country and the 150cc model can at best be described as another variant but not a new entrant to the market.

However, some of the functionaries attending the meeting said the Yamaha 150cc model came close to fiting the definition of a `new entrant`.

Mr Dar directed the stakeholders concerned to first decide on their own level how they wanted to define a new entrant and what incentives a new variant should avail.

Meanwhile, the meeting approved three months` salary for the employees of Pakistan Steel Mills, keeping in mind the hardship faced by them and their families.

The minister pointed out that previously the government had been approving salary for two months at a time.The ECC also approved issuance of sovereign guarantee in respect of the Syndicated Term Finance Facility of Rs136.5bn for the power sector.

The meeting decided that the loans acquiredin2012forthePowerHolding (Private) Limited, which reached maturity a couple of months ago, would be rolled over. The interest payments on these loans are being financed through the power tariff but the principal amount had to be rolled over through fresh STFCs by a consortium of nine commercial banks.

The decision was taken on the request of the water and power ministry as the Power Holding (Private) Limited is a public-sector entity and will be responsible for arranging loan amounting to Rs136.5bn for the power sector companies.

The ECC directed the food security ministry to monitor supply position and prices of gram pulse to cater to the country`s demand in the light of international prices. The meeting asked the ministry to coordinate with the provincial governments for ensuring price control and steady supply of gram pulse in the market.

The meeting also allowed the petroleum ministry to replace Lower Zakum crude price with Das Blend crude price to determine basket price for oil refineries.