The MoF took such a step after the cabinet meeting on Thursday set the terms and conditions of loans and decided to pledge to the CIT government guarantee to assure the loans will be repaid. [break]
This has finally paved the way for the debt ridden state-owned petroleum import monopolist to get hold of the fund it needs direly to step up imports.
Although the government had decided last week to provide Rs 2 billion to the NOC to finance imports and end month-long fuel scarcity, the decision, however, was mum over pledging collateral or guarantee to the lender.
As a result, CIT had refused to pledge the loans. This in turn had prevented NOC from stepping up imports, which was much needed for fighting the scarcity.
“The Thursday´s cabinet meeting on Ministry of Commerce and Supplies´ proposal finally issued the terms and conditions of loans,” said a source at MoF. Following the decision, the MoF issued the government guarantee to the CIT in the late office hour.
The source further told Republica that the MoF has verbally instructed the CIT to hold a board meeting early on Friday and release the fund to the corporation by the afternoon. “If the CIT management acted with urgency, NOC will receive the fund tomorrow,” he stated.
Meanwhile, NOC officials said they are pumping out well over 300 kiloliters of petrol in the market over the last few days. “This has somewhat eased the situation of petrol availability,” said an NOC official.
However, consumers continue to reel under severe scarcity of liquefied petroleum gas. Shortage of diesel, on which NOC is incurring losses of well over Rs 12 per liter, is still worse.
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