ISLAMABAD: The Economic Co-ordination Committee (ECC) of the Cabinet has approved reduction in duties on LPG equipment up to 10 percent to promote LNG as an alternative fuel to natural gas in the country. The ECC meeting presided over by the Finance Minister Dr Abdul Hafeez Sheikh decided to reduce the duty on LPG pumps, control panel, LPG dispensers, and LPG vehicles conversion kits to 10 percent.

An official said that the ECC rejected a proposal of lifting ban on CNG cylinders and CNG conversion kits after the proposal was opposed by the Minister of Petroleum and Natural Resources.

Sources said that duty on LPG pumps has been reduced from 20 percent to 10 percent, control panel from 25 percent to 10 percent, LPG vehicles from 35 percent to 10 percent whereas duty on LPG dispensers is already below 10 percent. The committee decided that duty on LPG equipment below 10 percent would remain unchanged.

However, sales tax and withholding tax would remain intact on the import of LPG equipment. Ministry of Petroleum in a summary on allocation of gas to fertiliser plants from alternate sources stated that all existing gas producing fields have already been allocated either directly to consumers in some cases or to gas utility companies in most of the cases, hence it would not be possible to allocate gas from such gas fields. However, upcoming gas from existing fields and/or new discoveries may be dedicated for fertiliser sector especially the four fertilisers presently on SNGPL system. The Ministry further stated that fertiliser plants would be allowed to directly negotiate gas supply arrangements with the gas producers.

The ECC gave in principle approval for the summary provided that concept of supply of gas to power sector as first priority should not be affected. Ministry of Petroleum would submit a comprehensive plan for allocation of 256 MMCFD gas to fertiliser plants to the ECC.

The ECC deliberated in details on a summary moved by Ministry of Commerce regarding protection to the Motor Cycle Industry and constituted a committee comprising Deputy Chairman Planning Commission (DCPC), Chairman BoI, Secretary Commerce and Secretary Industries. The committee would give a detailed presentation on trends, production types of motorcycles, importers, and manufactures, rate of returns, technology type, tariff regime, barriers to new entrants and barriers to competitors in the motor cycle industry of the country. The committee in the presentation would also cover viewpoint of new entrants, their requirements, optimal protection as well as view point of existing manufacturers.

Secretary Commerce presented a general tariff reduction plan for motor cycle industry and new entrant’s policy highlighting rate of duties on different equipments in the light of recommendation of the sub-committee constituted by the previous ECC meetings.

On a summary moved by the Ministry of Petroleum, the ECC approved allocation of 20MMCFD gas to Nooriabad power plant on the request of Sindh government from 50 percent share of Sui Southern Gas Company Limited (SSGCL). Secretary Petroleum submitted a summary to the ECC for allocation of gas to SSGC and SNGPL on equal sharing basis of 50:50 from new sources of Jhal Magsi South field (Kotra Block), Tando Allah Yar and Dars field and Nur & Bagla & Jakhro field that contained a total production of 112 MMCFD. The Ministry also proposed that out of 50 percent share of SSGC, 20 MMCFD gas would be placed for 100MW power plant at Nooriabad Industrial Estate which was approved by the ECC. The meeting decided that further allocation of gas will be finalised after due consultation with different stake holders.