ECC orders steps to control rising prices
1. Inflation during first half of FY25 fall significantly to 7.2%, compared to 28.8% during same period last year
ISLAMABAD: On Monday, the Economic Coordination Committee (ECC) of the cabinet voiced concerns over the rising prices of sugar, vegetables, and edible oil, especially given the declining trends in global markets.
The meeting, chaired by Federal Minister for Finance and Revenue Muhammad Aurangzeb, reviewed inflation trends and essential commodity prices as reported by the Economic Advisor’s Wing of the Finance Division.
The ECC was informed that inflation during the first half of FY2025 (July-December) had fallen significantly to 7.2%, compared to 28.8% in the same period last year. December 2024 saw inflation at 4.1%, a steep drop from 29.7% in December 2023, marking the lowest inflation rate in 80 months. This was attributed to exchange rate stability, prudent fiscal policies, and better supply of essential goods across the country.
Despite satisfaction with the declining Sensitive Price Index (SPI) in recent weeks, the committee emphasized that these improvements should bring tangible relief to the public. However, it expressed concern over the rising prices of sugar, vegetables, and edible oil, despite falling international prices.
To address this, the ECC directed the Ministry of Industries and Production and the Ministry of National Food Security & Research to collaborate with the National Price Monitoring Committee (NPMC). They were tasked to report back within two weeks with strategies to maintain strategic reserves of wheat, sugar, and pulses, and to ensure efficient supply chains of essential items ahead of the holy month of Ramazan.
The ECC also urged provincial price control committees to enforce stricter price regulation, combat cartelization, and prevent profiteering to protect consumers from unfair price hikes. The chair reaffirmed the government’s commitment to ensuring the availability of essential commodities at affordable prices.
In its regular agenda, the ECC approved a summary from the Revenue Division introducing policy changes to the Export Facilitation Scheme (EFS) 2021. The changes aimed to reduce input utilization periods, adjust input authorizations, and strengthen vendor facilitation and sample monitoring. Additionally, the ECC approved withdrawing EFS facilities from importers of iron and steel scrap.
The committee also approved the release of a technical supplementary grant of Rs2.79 billion for the procurement of arms and ammunition, engaging Nespak as a design consultant for Digital Enforcement Stations (DES), and establishing checkpoints. A further Rs494.56 million grant was approved for the Frontier Corps KP (North) for constructing barracks and checkposts. A separate proposal to release Rs1.792 billion for Reko Diq project activities was deferred for further clarification.
The ECC also considered and approved an amendment to the 16th February 2024 mediation agreement regarding KE’s tariff differential subsidy claims and payables to state-owned enterprises. Lastly, the committee approved a Rs500 million grant for the Intelligence Bureau (IB).
