ECC tightens vehicle import rules, raises oil dealer margins

By Staff Reporter

ISLAMABAD: The Economic Coordination Committee of the cabinet approved changes to the vehicle import rules and raised margins for oil marketing companies and petroleum dealers, as officials grapple with energy costs, trade reforms and fiscal pressures.

The ECC, chaired by Finance Minister Muhammad Aurangzeb, also reviewed the Circular Debt Management Plan for fiscal year 2026 and directed the Power Division to develop a medium-term roadmap aimed at gradually reducing government support to the power sector, according to a statement from the Finance Division. The committee emphasised the need for stronger follow-up mechanisms with distribution companies to ensure they meet performance targets.

In a move to streamline imports, the ECC endorsed amendments proposed by the Ministry of Commerce that retain only the Transfer of Residence and Gift Schemes for vehicles. Commercial-import safety and environmental standards will now apply to these schemes, the eligibility period for imports has been extended from two to three years, and imported vehicles will be non-transferable for one year.

The committee also approved adjustments to margins for oil marketing companies and dealers on motor spirit and high-speed diesel, linking the increases to movements in the national consumer price index for fiscal years 2024 and 2025. The hikes, capped between 5% and 10%, will be implemented in two phases: half paid immediately, with the balance contingent on digitisation milestones to be assessed by June 1, 2026.

To mitigate public health risks, the ECC restricted chloroform imports to pharmaceutical companies only, requiring a no-objection certificate from the Drug Regulatory Authority of Pakistan.
The panel turned down a request from Ghani Glass Ltd. for concessionary tariffs on gas and regasified liquefied natural gas, citing that such subsidies are not permitted and pointing to ongoing broader measures to support exports.

In administrative actions, the ECC greenlighted a technical supplementary grant of Rs1.28 billion to the Pakistan Digital Authority to advance digital transformation initiatives across government bodies. It also authorized the release of development funds for the Cabinet Division and allocated Rs5 billion to the Housing and Works Division.

Separately, the committee approved the establishment of a special-purpose company to handle the winding up of the Pakistan Agricultural Storage and Services Corp., including settling its liabilities and managing its dissolution. The ECC gave in-principle approval for budgetary releases to Pakistan International Airlines Holding Co. to cover pension and medical expenses for employees of Pakistan International Airlines Corp. Ltd.