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Event Title: Senate Standing Committee on Industries and Production

Event Date: 2020-02-27

Senate Standing Committee on Industries and Production in its meeting discussed at length the issue of prices of cars being assembled in the country being on the rise despite the claims by the manufacturers that most of the parts are manufactured locally. The Committee heard the ministry as well as the Engineering Development Board on the matter and decided to call vehicle manufacturers to hear their side of the view before reaching a conclusion.

The Committee was told that mostly the engine parts and some critical parts which require heavy investment and hi-tech parts are imported while other parts including structure, interior, exterior, suspension, brake system are being manufactured locally. It was also told that car manufacturers are in private sector and there is no legal provision available with the ministry or EDB to control or fix prices of automobiles in the country. Moreover, it was told that exchange rate, imposition of levies fall within the purview of Federal Board of Revenue. It was decided that the discussion on decline in the sale of cars and other vehicles will also be clubbed with the aforementioned discussion.

The Committee was given a bi-annual review of the budgetary allocation and its utilisation by the ministry of industries and Production, with special focus on PSDP allocation for 2019-20 along with details of PSDP proposals for 2020-21. An amount of 14.358 billion was allocated to the ministry for 2019-20 around half of which (7.526 billion) has been utilised. For the 2020-21 cycle, the ministry has proposed an allocation of 20.764 billion in PSDP for 34 different projects. The details of projects were shared with the committee and will be discussed in coming meetings.

The matter of progress of revival plan and payment to all retired employees within 120 days in the light of direction given to the chairman PSMC, Ministry of Finance and other stakeholders in its meeting held in October 2019 was also discussed in the meeting. The ministry told the committee that a number of steps have been taken time and again to resolve the financial crisis of PSM and the issue of pending salaries and outstanding dues of former employees but the dues have heavily increased standing currently at 20.87 billion. The Committee was told that a fresh summary for the said amount has also been moved and in meetings held at finance division proposals were considered to develop a comprehensive plan for settlement of dues and liabilities. The Committee decided to continue discussing the matter until the grievances of retired employees are addressed.

The Committee was also briefed by Managing Director Utility Stores Corporation of Pakistan on the matter relating to taxation and subsidy being given by the government. The Committee was told that the government has released 6 billion for subsidy and procurement. PM Relief package has been launched which includes subsidy on five basic food items; wheat, sugar, ghee, rice and pulses. The basic food items are available at utility stores at prices lower than open market. The government has also allocated additionally an amount of 15 billion to the corporation out of which 5 billion will be used for inventory purchases ad 10 billion will be used for subsidy on essential commodities. The Committee appreciated the corporation for ensuring better quality and having better sales over the course of past few months.

The meeting was held under the chairmanship of Senator Ahmed Khan here at the Parliament House on Thursday and was attended among others by Senators Behramand Tangi, Aurangzeb Khan, Seemi Ezdi, Keshoo Bai, Sitara Ayaz, Advisor to Prime Minister Abdur Razzak Daood, Secretary Ministry of industries and production and senior officials from the ministry and its departments.