April 27, 2020: The ECC chaired by Adviser to Prime Minister on Finance & Revenue Dr Abdul Hafeez Shaikh also approved a credit loss subsidy of Rs 30 billion for the Risk Sharing Facility for State Bank of Pakistan’s Refinance Scheme to support employment and prevent lay-off of workers.
Under the Rs 50.69 billion package titled as ‘ChotaKarobar o SannatImadadi Package’ and prepared by the Ministry of Industries and Production with active consultation with Small and Medium Enterprises Development Authority (SMEDA), approximately 95 per cent commercial consumers with connected load up to 5 KW and 72 per cent of industrial consumers with a connected load of up to 70 KW would be provided financial support.
Under the scheme, commercial consumers would be given support up to Rs 100,000 and industrial consumers up to Rs 450,000 for three months. The base period for estimating electricity consumption would be May-July 2019 and for meters for which electricity consumption data is not available for the full base period, the appropriate average will be used.
To avail of the facility under the ‘ChotaKarobar o SannatImadadi Package’, pre-paid electricity bills of three months or total bills during the base period would be required. The period of consumption of the extended financial support would be six months starting from May/June 2020. The ECC also allowed Rs 2.5 billion block allocation to the AJK and GB for disbursement through special arrangement. It further instructed the Ministry of Industries and Production to bring up similar relief packages for the agriculture sector including the agricultural tubewells, as well as transporters and the microfinance sector.
The ECC on a proposal by the Finance Division also approved a credit loss subsidy of Rs 30 billion for the Risk Sharing Facility for State Bank of Pakistan’s Refinance Scheme to support employment and prevent lay-off of workers. Under the scheme, financing would be extended to businesses with a maximum sales turnover of Rs 2 billion while the Government of Pakistan would bear 40 per cent first loss on the distributed portfolio (principal portion only) for eligible borrowers, in case of repayments, after being classified as “loss” as per classification criteria under the respective SBP Prudential Regulations. The banks and DFIs assigned limits under SBP scheme would be eligible for executing agencies.
On a proposal by the Ministry of Economic Affairs, the ECC accorded in-principle approval to the external debt restructuring of the Government of Pakistan by availing the G-20 debt relief and engaging with bilateral donors for individual debt suspension with the proviso that agreements to that effect could be subsequently brought to the ECC for approval.
On another proposal by the Ministry of Defence, the ECC also approved the allocation of additional funds in the form of a technical supplementary grant to the tune of Rs 3.02 billion for the fencing of Pak-Iran border.
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