The Economic Coordination Committee (ECC) of the Cabinet formally gave approval to an Rs 100 billion electricity subsidy package for five export sectors and deferred a decision to set the minimum support price (MSP) of wheat for the 2022-23 season.
Presided over by Finance Minister Ishaq Dar, the meeting also approved Rs 410 million for effective security arrangements ahead of PTIs upcoming march to the federal capital and relaxed conditions for the import of wheat through Gwadar port regardless of around Rs 9,000 to 10,500 per tonne higher freight cost.
The meeting sanctioned the continuation of regionally competitive electricity tariff (RCET) at a cost of Rs 19.99 per kWh, all-inclusive, to five export-oriented sectors leather, textile (including jute), carpet, surgical and sports goods across Pakistan from Oct 1 to June 30, 2023, according to a statement issued by the Ministry of Finance.
Moreover, FM Ishaq Dar and exporters decided to change the rate in local currency to Rs 19.99 per unit instead of nine cents at the exchange rate of that date.
Prime Minister Shehbaz Sharif and former finance minister Miftah Ismail earlier fixed the RCET at nine cents and implemented it for a couple of months but owing to some follow-up fiscal challenges this was reported to have come to an end on Oct 1.
According to the Ministry of Commerce, the RCET had supported Pakistans industry to achieve historic high exports of around $32 billion during 2021-22 despite the terrible effects of the Covid-19 pandemic and severe economic challenges.
The ECC also submitted a summary from the Ministry of National Food Security and Research (MNFSR) that sought to set the minimum support price (MSP) of wheat at Rs 3,000 or Rs 3,200 per 40kg for 2022-23.
It stated that if the MSP was fixed at Rs 3,000, the farmers would be able to get a profit margin of 20 percent while 28 percent if fixed at Rs 3,200.