ISLAMABAD  - Apart from approving sugar export and urea import, the Economic Coordination Committee (ECC) of the Cabinet has approved a proposal regarding acquisition of eight planes on lease by Pakistan International Airlines (PIA) at an expense of $29.9 million.

The ECC, which met under the chairmanship of Finance Minister Senator Ishaq Dar on Thursday, has also reviewed the economic situation of the country.

The top economic decisions body of the country has approved the summary of the Aviation Division for release of an amount of $29.9 million to PIAC for acquisition of aircrafts on dry lease. PIA intends to lease eight A320S offered by Qatar Aviation Lease Company through international tender. These aircraft will be available from April 2014. The Finance Minister directed the management of PIA that they cannot go outside the tender.

The PIA management said that agreement between the PIA and the Qatar Aircraft Leasing Company would be inked in a few days. He added that acquisition of fuel-efficient aircraft was part of the PIA revival plan. The planes are two to three years old and will be operated on domestic and international routes. After their induction, the PIA will be able to restore some of its routes as well.

The ECC considered and approved the summary of the Finance Division for import of 0.125 million tons of urea fertilizer for the incoming Kharif (April to September season) 2014 in order to meet the demand as recommended by the Ministry of National Food Security. This import will not impact our foreign exchange reserves, as the same will be imported through ITFC. The Finance Minister on the occasion said that the earlier decision of the ECC to maintain the retail price of Rs.1786 per bag must be ensured in the local market. He said that the Ministries of Food Security and Industries & Production should work in coordination with the provinces for the agreed price.  Meanwhile, the meeting considered and approved the summary of the Ministry of Commerce for export of 250,000 Metric Tons of sugar by sugar mills from surplus sugar stock on the following conditions: quota will be allocated on first come first served basis, export may be made against irrecoverable letter of credit or a contract with 25pc non-refundable advance payment and shipment may be made within 45 days of the registration of contract with  the SBP, and the non-refundable advance payment to be forfeited in favour of Government of Pakistan in case of non-performance.

The Finance Minister also directed Ministry of Industries and Production to ensure outstanding payments to sugar cane growers by sugar mills in coordination with the provinces. However, market sources believed that government’s decision of exporting sugar might create its shortage in the country leading to increase its prices.