ECC meeting: Oil reserves jump as circular debt cleared

Committee voices concern over trend of rising oil prices in the international market.

ISLAMABAD:

The country’s oil reserves have gone up following the government’s decision to clear circular debt, the Economic Coordination Committee has been told.

According to a statement released following the ECC meeting on Thursday, oil reserves in the country currently sit comfortably at 36 days, against the 23 days in the corresponding period last year.

The meeting, chaired by Finance Minister Ishaq Dar, was informed that the improvement is a result of the government’s decision to clear circular debt which has provided Pakistan State Oil the liquidity needed to open letters of credit for the import of oil, it stated. The committee, however, expressed concern over the trend of rising crude oil prices in the international market, the statement added.

The ECC also deliberated over recent pressure on prices of essential commodities. Finance Minister Dar said provincial governments may be asked to keep a check on essential food items so that hoarders and speculators do not make undue profits. The meeting was also told that the Karachi Stock Exchange index reached 23,437 points, showing an increase of 17.7% since May 11. It was also informed that the Business Confidence Index – which was -34% last year – has now turned positive to 2.0 points, ‘a clear testimony of the markets’ confidence on the economic policies of the present government’, according to the statement.

“International banks which were earlier hesitant to extend any loans to Pakistan are now prepared to do business with us,” the statement quoted Dar as saying.

Published in The Express Tribune, August 16^th, 2013.