Kailash Kumar
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Pakistan to power small businesses with free electricity
AAMIR SAEED
April 27, 2020
A bread maker wearing a facemask watches on television Pakistan's Prime Minister Imran Khan (L top) addressing to the nation during a government-imposed nationwide lockdown as a preventive measure against the COVID-19 coronavirus, in Islamabad on April 14, 2020.
ISLAMABAD: Pakistan has approved a Rs50.69 billion ($315 million) relief package for small and medium-sized enterprises to support them through the coronavirus lockdown by covering their electricity bills for three months.
According to the Economic Coordination Committee (ECC), the scheme will cover some 3.5 million SMEs.
“Small businesses and the cottage industry are hit hard by the coronavirus lockdown, and we want to help them sustain their business in this difficult time,” Federal Minister for Industries and Production Hammad Azhar told reporters after the ECC’s meeting on Monday.
The government has been struggling to keep businesses and industries afloat by injecting cash and introducing various fiscal stimuli during the lockdown period.
Under the electricity support package, commercial consumers will have their energy bills covered by up to Rs100,000 and industrial consumers up to Rs450,000 rupees in total. The sums will be based on their energy consumption and payments in May, June, and July 2019.
“Both tax filers and non-filers are eligible for this scheme,” Azhar said, adding that the government would introduce a few other sector-specific policies in the next phase.
The minister said the government was also working on the provision of soft loans to small businesses without collateral so that they could retain their staff.
Business owners have, however, termed the relief package as an “eyewash” and demanded that the government allow them to resume operations during specific hours.
“Our businesses are closed for the last one month, but we still have to pay millions of dues, including salaries, to our workers,” Mehmood Hamid, president of All-Pakistan Organization of Small Traders and Cottage Industries, told Arab News. “Electricity bills are just a small fraction of our expenditures.”
Separately, the ECC also approved the restructuring of the government’s external debt, following a decision by the Group of 20 major economies to suspend debt service payments for the world’s poorest countries, including Pakistan, through the end of the year.
The freezing of both principal repayments and interest payments is aimed at allowing developing countries to spend more on improving their health systems amid the coronavirus pandemic. It was decided by G-20 finance officials in a meeting in Riyadh on April 15.
Pakistan spends a major chunk of its budget on debt servicing each year as it has over $100 billion in debt to foreign lenders.
https://www.arabnews.pk/node/1665921/pakistan
AAMIR SAEED
April 27, 2020
A bread maker wearing a facemask watches on television Pakistan's Prime Minister Imran Khan (L top) addressing to the nation during a government-imposed nationwide lockdown as a preventive measure against the COVID-19 coronavirus, in Islamabad on April 14, 2020.
ISLAMABAD: Pakistan has approved a Rs50.69 billion ($315 million) relief package for small and medium-sized enterprises to support them through the coronavirus lockdown by covering their electricity bills for three months.
According to the Economic Coordination Committee (ECC), the scheme will cover some 3.5 million SMEs.
“Small businesses and the cottage industry are hit hard by the coronavirus lockdown, and we want to help them sustain their business in this difficult time,” Federal Minister for Industries and Production Hammad Azhar told reporters after the ECC’s meeting on Monday.
The government has been struggling to keep businesses and industries afloat by injecting cash and introducing various fiscal stimuli during the lockdown period.
Under the electricity support package, commercial consumers will have their energy bills covered by up to Rs100,000 and industrial consumers up to Rs450,000 rupees in total. The sums will be based on their energy consumption and payments in May, June, and July 2019.
“Both tax filers and non-filers are eligible for this scheme,” Azhar said, adding that the government would introduce a few other sector-specific policies in the next phase.
The minister said the government was also working on the provision of soft loans to small businesses without collateral so that they could retain their staff.
Business owners have, however, termed the relief package as an “eyewash” and demanded that the government allow them to resume operations during specific hours.
“Our businesses are closed for the last one month, but we still have to pay millions of dues, including salaries, to our workers,” Mehmood Hamid, president of All-Pakistan Organization of Small Traders and Cottage Industries, told Arab News. “Electricity bills are just a small fraction of our expenditures.”
Separately, the ECC also approved the restructuring of the government’s external debt, following a decision by the Group of 20 major economies to suspend debt service payments for the world’s poorest countries, including Pakistan, through the end of the year.
The freezing of both principal repayments and interest payments is aimed at allowing developing countries to spend more on improving their health systems amid the coronavirus pandemic. It was decided by G-20 finance officials in a meeting in Riyadh on April 15.
Pakistan spends a major chunk of its budget on debt servicing each year as it has over $100 billion in debt to foreign lenders.
https://www.arabnews.pk/node/1665921/pakistan
