ECC approves Multi-Billion package for Agriculture, LoC families and Industry


Extending the economic stimulus presented by Economic Coordination Committee (ECC) and PM Imran Khan, ECC approved a multi-billion package for agriculture and farmers yesterday. The package includes several financial relief factors including reduction in interest on agricultural loans, subsidies on cotton seeds and fertilizers, and tax subsidies on tractors.

Subsidy on DAP and Urea

The Covid-19 economic stimulus presented by ECC in March reserved Rs. 100 billion for agriculture and SMEs out of Rs. 1.2 trillion. Out of the Rs. 100 billion, ECC, under recommendation of Ministry of National Food Security and Research, approved Rs. 56 billion for the agriculture sector.

Read More: ECC Approves Rs. 1.2 trillion stimulus package for Covid-19

The packages includes subsidy of Rs. 925 per bag on DAP which has an estimated offtake of 3/04 million tons. In addition, Rs. 243 per bag subsidy on urea bags is also approved which has an estimated offtake of 0.95 million tons during current season. Since the fertilizer and DAP constitutes of more than 15% cost of production for farmers, the package will benefit farmers to a significant extent. Another packages of Rs. 152 billion was approved in the meeting for delivery of 35,000 metric tons of wheat to government of Azad Jammu and Kashmir by PASSCO with federal government bearing 50% of expenses.

Subsidy for Agricultural loans and purchases

The package also includes amount of Rs. 8.8 billion dedicated for relief in mark-up payments by agriculture sector, a subsidy of Rs. 2.3 billion for cotton seeds and Rs. 6 billion for pesticides. Due to government’s new policy related to cut in imports, the finance ministry also approved a subsidy of Rs. 2.5 billion for farmers purchasing local tractors. The subsidy on local tractors is also targeted at providing a relief to local manufacturers as well. The committee also highlighted the need for inclusion of banks other than ZTBL to increase access of small farmers, specifically with less land holdings to financial support.

The ministry also stressed on inclusion of Ministry of Industries and Production in the government’s decisions to avoid any rise in price of fertilizers due to high demand. Moreover, to ensure the transparency of scheme and disbursement of funds for genuine farmers, ECC recommended adoption of scratch card system as by Punjab government for true data collection.

Package for LoC families

ECC during the meeting also released details for financial support of LoC families that have recently been affected by Indian army’s bombardment near Line of Control. The ministry decided to provide Rs. 12000 for affected families till 30th June 2020 and Rs. 2000 for six months till 31st December 2020.

Package for Industrial Sector

The ECC in meeting resolved pending decisions regarding payments due to Pakistan Steel Mills (PSM) employees in lieu of retirement and terminations that were part of government’s initiative to revive PSM. A package of Rs. 18.7 billion was approved for compensating over 8000 employees of PSM. Moreover, in order to promote acquisition and localization of mobile device manufacturing and digitization of services in Pakistan, ECC approved proposal by Ministry of Industries and Production for local investment, FDI and joint ventures. The proposed strategy will generate more than 200,000 local jobs along with increase in exports division.

Lastly, a technical supplementary grant of Rs. 16.6 billion was set to deal with expenses of POL, and Defence services in lieu of Covid-19 medical supplies. Another relief of Rs. 320 million was allocated for clearing salaries of employees of Pakistan Machine Tool Factory and Federal Judicial Academy.


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