The Federal Cabinet’s Economic Coordination Committee (ECC) approved the establishment of an $85 million World Bank-funded Credit Guarantee Trust Fund for low-income housing through the Second Supplemental Trust Deed (Mera Pakistan Mera Ghar).
The meeting presided over by Finance Minister Ishaq Dar approved the new Fund in response to a request from the Finance Division to provide risk coverage to financing institutions (FIs) in the housing sector.
Pakistan Mortgage Refinance Company Limited (PMRC) was established as a joint initiative of the government of Pakistan and commercial banks/development finance institutions (DFIs) to provide medium and long-term funding to primary mortgage lenders by borrowing at lower interest rates from the capital debt market.
PMRC, as trustee, established the Credit Guarantee Trust Scheme under the First Supplemental Trust Deed.
Moreover, as a trustee of the Fund, the Pakistan Mortgage Refinance Company Limited (PMRC) will receive 0.25 on premiums received from FIs against their portfolio covered as trustees under the new scheme.
On the support front, the government of Pakistan will provide an initial backdrop arrangement of Rs. 7 billion, with the commitment to increase it up to Rs. 30 billion if necessary, based on the Oversight Committee’s recommendations.
An Oversight Committee may be formed to monitor the operations of the Credit Guarantee Trust Fund to ensure that it meets its developmental goal and that the Government’s contingent liability remains within the agreed limit.
During the meeting, the ECC also approved a proposal to reduce RD on Disodium Carbonate (PCT – 2836.2000) from 20% to 10% and imposed RD on filament Yarns at 5%.
In addition, the ECC discussed the summary submitted by the Ministry of National Food Security and Research on the Kissan Package-2022 and approved the base tariff for electric tube wells at Rs13/kWH from Rs16.60/kWH, providing farmers with an Rs3.60/kWH relief effective November 1st, 22 to compensate for flood and heavy rain damage.
The Ministry of Information and Broadcasting submitted a budget summary for launching a comprehensive media awareness campaign on government initiatives, programmes, and projects.
After extensive deliberation, the ECC approved a Supplementary Grant of Rs 2 billion for flood-related media campaigns.