ISLAMABAD -  The Economic Coordination Committee of the Cabinet on Friday approved contract for purchase of 74MW electricity from Tavanir Iran and opening of Habib Bank Limited (HBL) branch in China.

The ECC, which met under the chair of Finance Minister Ishaq Dar, has approved a summary moved by the Ministry of Water and Power for allowing NTDC (National Transmission and Despatch Company Limited) to approach NEPRA for approval of extension of tariff from 1st January 2016 to 31st December 2016 for a contract with TAVANIR Iran for the purchase of 74MW.

The top economic decisions making body of the country, the ECC, has also given approval to HBL to open a bank branch in Urumqi, China. Opening of Pakistan’s bank branch in China would give momentum to the China-Pakistan Economic Corridor (CPEC) projects besides facilitating the businessmen of both the countries. China had given special concession to Pakistan in opening of bank branch by reducing minimum asset requirement to $15 billion from $20 billion.

The ECC allowed Finance Division to issue sovereign Sukuk in the international capital markets. The government had already initiated the process to issue $750 million worth of Sukuk bonds in international market to repay the debt borrowed by Pervez Musharraf government in 2007 at 6.75 percent interest rate. The Ministry of Finance has requested the international as well as local banks to submit their Expression of Interest to work as financial advisors/lead managers to structure and launch the sovereign Sukuk bonds in international capital market. The Finance Ministry, in budget documents, had estimated to raise Rs105.5 billion (around one billion dollars) from international capital markets through sovereign loans during the ongoing fiscal year. Moreover, the government had also targeted to generate Rs79.125 billion (around $750 million) through Sukuk bonds.

The ECC approved a summary of the Ministry of Water and Power for issuance of a policy directive to NEPRA to allow 1% of the Capital cost net of aforementioned $150,000/- amount on account of security to be distributed annually starting from the construction period till the term of the Power Purchase Agreement.

The ECC reviewed Macro Economic Indicators and noted that the CPI inflation was estimated to be 3.56 percent in August 2016 compared to 8.55 percent in August 2013 and 11.56 percent in August 2011. Furthermore, the ECC was informed that there was sufficient wheat stock in the country, which stood at 9.49 million tons on September 20, 2016, compared to 8.75 million tons at the corresponding period last year. The ECC was also apprised that Large Scale Manufacturing (LSM) increased by 3.2% in FY 2015-16.