ISLAMABAD Economic Coordination Committee (ECC) of the Cabinet on Thursday approved Rs 75 million per day subsidy for the Karachi Electric Supply Company (KSEC) besides an injection of Rs 3 billion into the financially crumbling Bank of Khyber. According to officials of the Finance Ministry, the Pakistan State Oil (PSO) informed the ECC that its stuck-up receivable had already gone to an alarming level of Rs 160 billion. Now providing fuel oil at the rate of gas to KESC would further deteriorate the financial conditions of the state-owned petroleum marketing company. Therefore, at the request of the PSO and also in order to save it from bankruptcy, the government has decided to pay the price differential between the gas and furnace oil. Thus the government would pay Rs 75 million to the KESC on daily basis so that it could pay the full price of the furnace oil to the PSO. According to the officials, the KESC would be entitled to this daily basis subsidy till the gas supply from Zamzama field is restored. Minister for Petroleum and Natural Resources Naveed Qamar informed the Committee that the supply from Zamzama would be restored in coming few days but the officials were of the view that it would take rest of the current month to be up again. Meanwhile, the ECC decision to support restructuring of the Khyber Bank by injecting Rs 3 billion would enable its revamping. This provision to the Bank was under the State Bank of Pakistan governed credit guarantee scheme under which the government had provided Rs 10 billion to the Bank of Punjab last year through the provincial government. Another decision of the ECC approved provision of euros 40 million of an Italian interest free loan of 35 years timeframe to the Pakistan Poverty Alleviation Fund (PPAF) at zero-rated mark-up. Earlier, the government had provided this loan to the PPAF at 15 per cent rate of return. The Fund, however, had requested that it was beyond its capacity to return this loan with such a high rate of interest. Taking up a summary of the Ministry of Petroleum and Natural Resources, the ECC approved blending of motor oil with Ethanol and Oil and Gas Regulatory Authority would review its prices after every six months. However, the ECC asked the Ministry to reprioritise the winter gas load management plan, which it had brought before the Committee in its shape of the 2005. Hazar Khan Bajarani the Minister for Industries, was ruthless against what he termed as local cartel of car manufacturers including Toyota, Hunda, and Suzuki and he requested opening up of used cars import. However, the Commerce Ministry stood in the way saying that the issue of import falls in its purview rather than that of the Ministry of Industries. Thus the ECC asked the two ministries to come up with a new summary signed with the two Ministers in the next meeting. The Committee noting the sugar market situation and huge difference from Rs 56 per kilogram Utility Stores price to Rs 95 per kg open market price the Committee made yet another Ministerial Committee involving provincial governments as well. The newly appointed Committee would report back within a week. The ECC also approved withdrawal of 5 per cent withholding tax on the electricity only for Karachi Export Processing Zone as an export incentive. It also withdrew five per cent regulatory duty on the import of sack craft. The officials of the Finance Ministry meanwhile claimed that the International Monetary Fund during the ongoing review of the economy had agreed on 4.7 per cent fiscal deficit for the coming with 2.8 to 3 per cent targeted GDP growth rate. Moreover, the inflation target was fixed at 13.5 per cent for the ongoing financial year.