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Islamabad: A meeting of Economic Coordination Committee (ECC) of Cabinet held here today with the Federal Minister for finance and Economic Affairs Dr. Abdul Hafeez Shaikh in the chair to discuss various agenda items of national importance. In the meeting, Secretary Finance gave a brief presentation about the key economic indicators.
He informed the meeting that Inflation is decreasing with Overall Consumer Price Index (CPI) in Oct, 2011 is 11.0 % as compared to previous year’s value of 15.3 % in same month. Inflation on food items has been decreased from 21.0% to 11.7% and non food items from 11.9% to 10.5% in this year. He informed that there is sudden downfall in Sensitive Price Index (SPI) with a latest value of 5.70 %.
He told that prices of the most of food items have been decreased except Rice. He highlighted that Large Scale Manufacturing has shown a great performance in this year but the our export may come under pressure in the coming months because of the current economic crisis in Europe and USA. Foreign Exchange Reserves stands at $ 16.90 Billion on 28th November 2011.
He also pointed that the current decreasing Foreign Investment can be matter of concern, but this decrease is mainly occurring in portfolio investment. While discussing on this issue, ECC directed the Board of Investment and State bank of Pakistan to come up a brief presentation on Foreign Investment in next meeting, which will tell the ECC about detailed process of calculating investment in the country, concerns of different companies for noninvestment, reasons of low investment and their subsequent remedies for revival of investment. ECC also stressed that this current decreasing trend of inflation is not being projected among the general public properly.
There is a dire need that this information gap should be reduced, so that people would also be informed about all positive changes as well. In this regard, media should play its role and inform the public about this positive news.
ECC deliberated on the summary proposed by Ministry of Petroleum and Natural Resources. The summary proposes of laying of 50 km new pipeline from Latif field to Sawan plant where surplus capacity is available that can be used for processing Latif Gas.
The summary states that if new avenues to process raw gas from Latif field are not fund out then the gas network will lose additional gas availability to the tune of 50-70 MMCFD.
ECC was informed that the other companies (Kandanwari Joint Venture) has refused to work on it due to low earning, so SSNGPL and SSGPL be allowed to accept Latif gas into system by laying 50 km pipeline of cost Rs. 2.308 billion with certain modalities. ECC approved in-principle the said proposal to go ahead and formed a sub committee comprising Deputy Chairman Planning Commission and representatives from Finance division, Petroleum division and Oil and Gas Regulatory Authority each.
This subcommittee will meet again shortly and put forwarded their recommendation to ECC regarding the detailed enabling steps of said proposal and its provisions and adjustments with the petroleum policy.
ECC deliberated on the recommendations of Ministry of Industries regarding purchase of 0.2 million tons of sugar from local market in order to continue the supply of sugar to Utility Stores in coming months and also to store sugar as a strategic reserve. ECC agreed to purchase sugar but with a strict provision that this sugar will not be purchased at the cost higher than the prevailing market value.
In this regard, a sub committee comprising Finance, Industries and Commerce Secretaries, was formed which will formulate any mechanism including the negotiations with the sugar mill owners to purchase sugar below the market prices.
ECC also reviewed the status of implementation of the decision taken in the meeting of ECC held on 11thNovember, 2011. In this regard, different officials updated ECC about their progress.
Secretary Finance, Petroleum and Natural Resource, Water and Power, Industries, Commerce, Statistic, Deputy Chairman Planning Commission, Governor SBP, Chairman Trading Cooperation of Pakistan, Chairman Board of Investment, Managing Director Utility Store and many others high officials were present in the meeting.
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