Islamabad –December 18, 2024 : While chairing the meeting of the Economic Coordination Committee (ECC), Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, provided a comprehensive overview of the economic landscape, underscoring the government’s consistent efforts to implement policies aimed at bolstering economic stability and ensuring sustainable growth.
The Minister also highlighted the progress made towards economic stability, the continued improvement in various economic sectors, and the government’s firm resolve to maintain and accelerate this momentum. He emphasized that the positive trends observed in economic indicators reflect the effectiveness of the government’s targeted measures and commitment to steering the country towards greater prosperity.
A key highlight of the meeting was the presentation of the most recent Consumer Price Index (CPI) data, which recorded a significant drop to 4.9% in November 2024. This represents the lowest level of inflation since April 2018, when CPI stood at 3.96%.
The current CPI figure marks the lowest in the past 78 months, signaling a positive shift in the country’s inflationary trends. The decline in CPI reflects the government’s success in managing inflationary pressures and restoring price stability, particularly for essential commodities.
The ECC was also briefed on the substantial reduction in the prices of several essential goods and services. Among the items that have seen price drops are wheat flour, chillies powder, diesel, petrol, pulses, onions, basmati rice, electricity charges, sugar, plain bread, tea, soap, chicken, eggs, tomatoes, garlic, firewood, and salt. These reductions are seen as critical measures that have eased the financial burden on the common man and strengthened the purchasing power of the population.
Minister Aurangzeb appreciated the efforts of relevent stakeholders as prices of Chicken has droped to Rs. 49 per kg (from Rs. 383 to Rs. 334), Gram pulse Rs.31per kg (from Rs. 411 to Rs. 380) and Mash pulse to Rs. 20 per kg (from Rs.528 to Rs.508) during last four weeks. The Chair also directed the NPMC and provincial govts to ensure smooth supply of essential items as well as take corrective measures regarding undue price hike.
The Minister reiterated that the government remains fully committed to ensuring that the positive trajectory of the economy continues. He emphasized that the government’s fiscal policies, including effective management of public finances, trade, and energy sectors, have contributed significantly to the improvement in these indicators. The Minister also reassured the public and business community that the government would remain focused on addressing inflation, stabilizing the currency, and improving domestic production.
During the meeting, it was noted that while the country is experiencing a period of economic stability, continued efforts are required to maintain this progress. The government plans to enhance economic diversification, invest in key sectors like agriculture, manufacturing, and infrastructure, and pursue reforms to strengthen the financial system. The ECC also acknowledged the critical role of public-private partnerships in achieving long-term economic growth and job creation.
The meeting reaffirmed the government’s commitment to ongoing reforms and stabilization measures aimed at ensuring economic growth and improving the living standards of the people.
The Economic Coordination Committee will continue to closely monitor developments and take proactive steps to safeguard economic stability and foster sustainable growth.
The Finance Minister expressed optimism that the progress made so far would serve as a foundation for future successes, as the government remains dedicated to building a prosperous and stable Pakistan.
Government of Pakistan
Finance Division
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Islamabad – 18th December 2024
PRESS RELEASE
Finance and Revenue Minister Senator Muhammad Aurangzeb Chairs ECC Meeting
Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, chaired a meeting of the Economic Coordination Committee (ECC) of the Cabinet, today.
The meeting was attended by Mr. Rana Tanveer Hussain, Minister for Industries and Production; Mr. Musadik Masood Malik, Minister for Petroleum; Sardar Awais Ahmad Khan Leghari, Minister for Power; Mr. Ahad Khan Cheema, Minister for Economic Affairs; Mir Jam Kamal Khan, Minister for Commerce; Mr. Ali Parvez Malik, Minister of State for Finance and Revenue; Governor State Bank of Pakistan; Chairman SECP; and Chairman Board of Investment. Federal Secretaries and senior officers from relevant ministries and divisions also attended the meeting.
The ECC deliberated on a detailed agenda and made the following decisions:
1. The ECC reviewed a summary submitted by the Ministry of Commerce regarding the sharing of subsidy on imported urea on a 50:50 basis. It approved the release of PKR 10 billion to the Ministry for immediate settlement of outstanding dues related to imported urea subsidies. The decision aims to alleviate the financial burden and ensure the smooth and timely availability of urea to meet agricultural needs. The ECC further directed the provinces to fulfill their share of subsidy payments, emphasizing equitable cost-sharing among all stakeholders.
2. The ECC considered a summary from the Ministry of Federal Education and Professional Training seeking approval for the provision of a PKR 1 billion government guarantee to launch the Pakistan Skills Impact Bond (PSIB), with NAVTTC as the issuer of the bond. The Committee advised the Ministry to develop a comprehensive plan and resubmit the summary for consideration.
3. The ECC approved a summary submitted by the Ministry of Housing and Works for the provision of a Technical Supplementary Grant (TSG) amounting to PKR 1.884 billion. The grant will facilitate necessary expenditures and address the financial requirements of ongoing projects under the Ministry.
4. The ECC approved a proposal regarding the establishment of the Siah Dik Copper Project in District Chagai, Balochistan, submitted by the Ministry of Industries and Production. It approved the declaration of Private Export Processing Zone (Saindak EPZ), under Section 9A read with Section (k) of the Ordinance. The decision aims to facilitate the development and export potential of the mineral sector in the region.
5. The ECC approved a budget allocation of Rs. 536.1 million for the Ministry of Information and Broadcasting as a Technical Supplementary Grant (TSG) under Demand No. 66 during FY 2024-25 from Cost Center IB5501 (Publicity and Advertising, I&B Division) under Demand No. 45: Grants, Subsidies, and Miscellaneous Expenditure.
6. The ECC approved a TSG amounting to Rs. 2,022,857,991/- (approx. USD 7,276,468/-) for the Digital Economy Enhancement Project (DEEP) NADRA, as surrendered by the Ministry of Information Technology & Telecom for the year 2024-25 in favor of the Ministry of Interior.
7. The ECC reiterated its previous decision regarding a quota ratio local/imported wheat for the remaining months of the current fiscal year at subsidized rates.
8. The ECC approved a proposal from the Ministry of Law and Justice to transfer funds amounting to Rs. 21,250,000 to the Islamabad High Court, Islamabad, through a Technical Supplementary Grant for the repair and maintenance works of the buildings of the Islamabad High Court.
9. The ECC approved a Technical Supplementary Grant (TSG) of Rs. 1,086 billion to pay outstanding claims of ZTBL under the Prime Minister’s Fiscal Package for Agriculture in the wake of Covid-19.
10. The ECC approved the restructuring plan for PRAL (Pakistan Revenue Automation Limited). It also decided on a revised financial flow and budgeting mechanism, including the opening of selected cost centers and the diversion of current year funding in consultation with the Secretary Finance. The provision of Rs. 3.7 billion as a Technical Supplementary Grant (TSG) for the current financial year 2024-25 was approved.
11. The ECC approved a Technical Supplementary Grant (TSG) of Rs. 523.078 million for the Special Investment Facilitation Council (SIFC) for its development needs.
12. The ECC considered the summary regarding the security package documents for the 7.07 MW Railii-II Hydro Power Project under the Power Generation Policy 2015. It approved the GOPIA (along with the GOP Guarantee) and the draft EPA for the Railii-II Hydro Power Project. It also approved AJ&KIA and WUA, with the contractual and payment obligations of AJ&K being backstopped and guaranteed by the GOP. The Boards of PPIB, CPPA-G, and GOAJ&K were authorized to make necessary project-specific amendments to the draft security package documents to ensure compliance with NEPRA’s Tariff Determination. The ECC directed to monitor timely financial close.
13. The ECC approved a Technical Supplementary Grant (TSG) amounting to Rs. 14 billion from the Prime Minister’s National Programme for Solarization of Agricultural Tubewells in Pakistan. The grant will be transferred under the Development Expenditure of the National Food Security and Research Division to the Power Division for onward payment, supporting energy efficiency in the agriculture sector.
14. The ECC approved the Finance Division’s proposal for the arrangement of rupee cover amounting to PKR 10 billion. This includes adjustments from the current side budgetary allocation for the current fiscal year, with USD 105.5 million allocated for the Water Infrastructure Project (WIF) funded by ADB and USD 137 million for the Flood Impact Infrastructure Project (FIIP) funded by the World Bank.
15. The ECC approved the inclusion of Tier 4 in the Cabinet-approved portfolio of the Prime Minister’s Youth Business and Agriculture Loan Scheme (PMYBALS). Under Tier 4, all loans will be term loans only, with an end-user rate of 0% on a first-loss basis on the disbursed portfolio. The scheme has a budgetary allocation of PKR 8.6 billion for the current fiscal year.
16. The ECC approved the creation of a Pension Fund through a Non-Banking Finance Company (NBFC) regulated by the SECP. Rs. 30 million was authorized as seed money for the NBFC, with Rs. 1 million approved to meet incorporation expenses. The following individuals were appointed 3 first directors of the company and a temporary Chief Executive Officer until a permanent CEO is appointed.
In concluding remarks, Finance Minister Senator Muhammad Aurangzeb emphasized the importance of ensuring timely policy measures to address critical economic, energy, and agricultural needs, with a focus on transparency and efficiency in implementation.
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