ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has approved an increase in gas prices effective from 1st February 2024 with recommendation of uniform gas price for fertilizer plants.
Pakistan has pledged to the International Monetary Fund (IMF) to inform them about the December 2023 semi-annual gas tariff adjustment decision by February 15, 2024. In a meeting chaired by Caretaker Finance Minister Dr. Shamshad Akhtar, the ECC has decided to endorse the proposed increase on Wednesday.
Reports indicate that gas prices are set to rise by up to 40 percent. However, an official mentioned that the ECC has recommended some modifications to the proposed hike in gas prices. It was decided that the relevant ministry would work on finalizing the increase for various sectors, with the possibility of a reduction for the domestic sector. The ultimate approval for the increase will be sought from the federal cabinet on Thursday.
The Finance Ministry revealed that the Petroleum Division’s proposal on natural gas sale pricing for the fiscal year 2023-24 (effective from February 1, 2024) was extensively discussed.
After deliberation, the ECC concluded that the revision of sale price tariffs should align with the revenue requirements of the Sui companies.
The committee proposed a uniform gas price for fertilizer plants. Additionally, the ECC instructed the Competition Commission of Pakistan (CCP) to investigate the recent unwarranted increase in urea prices and assign accountability. It also directed the Ministry of Industries to ensure stability in urea prices in the market.
The ECC also reviewed the Federal Board of Revenue’s (FBR) proposal regarding the rationalization of the criterion for an enhanced 25 percent sales tax rate on locally manufactured/assembled vehicles (PCT87.03), which was approved after thorough discussion.
The Finance Division sought approval for the share subscription agreement (SSA) of the National Credit Guarantee Company Limited (NCGCL) from the ECC. The ECC approved the signing of the SSA between NCGCL, Karandaz, and the government through the Ministry of Finance.
The Ministry of Commerce presented a summary proposing amendments to “SRO 760(I)/2013-import and export of precious metal jewelry and gemstones order, 2013” and the Import Policy Order 2022.
The ECC endorsed the proposals in principle and directed a committee comprising representatives from the Ministry of Commerce, Ministry of Law, FBR, and SECP to formulate detailed proposals for this export-oriented policy reform, targeting the opening up of the service sector.
Furthermore, the ECC approved the Intelligence Bureau’s summary for the provision of an additional Rs125 million during the current financial year to meet the increased operational requirements against terrorists and anti-state elements.
The Finance Division’s summary seeking approval of a Technical Supplementary Grant to provide rupee cover for the remaining funds amounting to Rs7,621,756,096 from the 1st tranche of credit lines of US $85 million obtained from the World Bank was also approved by the ECC.
