ECC approves proposal to issue a letter of comfort in favour of PSO

August 11, 2022 (MLN): The Economic Coordination Committee (ECC) of the Cabinet approved the proposal to issue a letter of comfort in favour of PSO for raising a loan facility of Rs50 billion on urgent basis.

Federal Minister for Finance and Revenue Mr. Miftah Ismail presided over the meeting at Finance Division today.

Ministry of Energy (Petroleum division) presented a summary on syndicated running finance facility for PSO. PSO’s liquidity issues were discussed in ECC meeting on 31st July,2022, in which it was also discussed to arrange a government guarantee loan to ease out liquidity issues of PSO. 

A consortium of banks was formed including ABL, NBP, MCB, UBL and HBL for sanctioning a loan amounting to Rs. 50 billion to PSO through a government guarantee.

As the issuance of guarantee will take time, the banks have shown their willingness to initiate the process of issuing loan on letter of Comfort.

In view of above, the ECC approved the proposal to issue a letter of comfort in favour of PSO for raising a loan facility of Rs50bn on urgent basis. However, Finance Division to divert some other allocated guarantees to PSO without exceeding Rs105bn domestic guarantee limit for the 1st quarter of CFY.

Federal Minister for Commerce Syed Naveed Qamar, Federal Minister for Power Mr. Khurram Dastgir Khan, Mr. Shahid Khaqan Abbasi MNA/ex-PM, Minister of State for Finance and Revenue Dr. Aisha Ghous Pasha, Minister of State for Petroleum Mr. Musadik Masood Malik, SAPM on Government Effectiveness Dr. Muhammad Jehanzeb Khan, Coordinator to the PM on economy Mr. Bilal Azhar Kayani , Coordinator to PM on Commerce & Industry Rana Ihsan Afzal, Federal Secretaries and senior officers attended the meeting.

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