Rs326 billion circular debt to be settled before June 30: ECC

ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet Thursday decided that Rs326 billion circular debt would be settled before June 30 while the rest of the amount would be settled before August 10.

The first meeting of the ECC, which met under the chairmanship of Minister for Finance, Revenue and Economic Affairs Mohammad Ishaq Dar, also approved Rs2 billion Ramzan Package for availability of major kitchen items on reduced prices from more than 4000 utility stores.

The ECC also directed that sugar stocks positions will be closely watched and it will be ensured that local availability is always in line with the demand.

The committee, while approving the proposal of settlement of circular debt, noted that the settlement would provide much needed liquidity to the power sector, increase fuel availability, solve several disputes that have led to closure of more than 1000 MW of capacity and consequently augment the power generation.

The meeting was also attended by ministers for water and power, petroleum and natural resources, planning and development, food security, science and technology and minister of state for IT.

The ECC took important decisions on a number of summaries presented by various ministries.

On a summary moved by the ministry of water and power, the ECC considered the proposal for settlement of circular debt in the power sector in the light of the commitment made by the finance minister during his budget speech.

The summary proposed the settlement of the entire Rs503 billion outstanding as circular debt.

Nandipur Power Project

The ECC considered a summary from the ministry of water and power requesting for issuance of government guarantee for the additional cost of Rs23 billion that the project has suffered in the past due to negligent delays in clearance of documents.

In view of the significance of the project in meeting the critical shortages in the power sector the ECC approved provision of letter of comfort that will allow the EPC contractor to remobilize and complete the project within the shortest possible time.

Import of LNG

The ECC also considered a summary from the ministry of petroleum and natural resources for the import of LNG.

The Summary suggested that the previous effort in this regard was conducted in haste and the Supreme Court had also taken notice of the lapses in the process and desired for a fresh decision from the ECC.

The ECC approved the proposal for cancellation of the two tenders previously bid for this purpose. The ECC decided that the new process will be considered and approved in the next meeting.