Following are major policy measures taken during FY00:

The Federal Government sanctioned payment of duty draw back on the import of 42 raw materials for the textile sector w.e.f. 23rd July 1999.

The export finance facility for cotton yarn of below 30 counts was extended for another six months up to 31st December 1999.

The Central Board of Revenue on 17th January 2000 reduced central excise duty on polyester filament yarn and polyester chips from 10 percent and 15 percent respectively to 5 percent.

·On 5th February 2000, the Government decided to remove 14 textile made-ups from the negative import list to make Pakistan's textile industry more competitive. The items included are woven fabrics, carpets, curtains, apparel and clothing and bed linen.

In a major legislative step towards privatization of two major gas distribution companies, an Ordinance was promulgated on 11th January 2000 for the establishment of Natural Gas Regulatory Authority.

The Central Board of Revenue (CBR) allowed on 4th April 2000 exemption to gas companies from payment of duties on import of machinery, equipment, materials, specialized vehicles, accessories, spares, chemicals and consumables which are not manufactured locally.

To stabilize the domestic prices and protect local industry, the Economic Coordination Committee (ECC) on 21st December 1999 decided to impose regulatory duty of 10 percent on the import of urea fertilizer.

The Ghee Corporation of Pakistan (GCP) and the Federal Chemical & Ceramics Corporation Limited (FCCCL) were merged with the National Fertilizer Corporation (NFC) with effect from 8th January 2000 in order to give effect to the Government's policy of right sizing and reducing expenditures.

To check mushroom growth of flourmills in the country, the ECC in its meeting held on 1st July 1999, decided to direct the banks not to provide loans for establishment of flourmills in future.

To promote business and manufacturing of jeeps in the country, the Central Board of Revenue withdrew on 28th April 2000 the levy of 3.7 percent Capital Value Tax (CVT) on locally manufactured jeeps.

The minimum cash margin requirement on industrial raw material was withdrawn on 27th October 1999 while on machinery of all kind as well as spare parts, it was withdrawn w.e.f. 1st November 1999. The minimum cash margin requirement on the following items was also withdrawn on 13th April 2000. These items are:

Unserviceable vessels used by the ship-breaking industry for scraping;
Medical equipment, life saving devices and various consumables used for patients;
Raw material used for printing and graphic arts industry for printing and packaging.

On 4th April 2000, the Central Board of Revenue (CBR) announced repayment of custom duty on the import of various raw materials. These raw materials included metalled polypropylene film, zinc, alloy wire, top lid resin and hardener.

The Federal Government set up a Committee for Revival of Sick Industrial Units on 3rd May 2000. The terms of reference of the committee are as follows.

Prepare a list of sick units that can be revived and cannot be revived.

Identify causes of sickness of industrial units and recommend measures for their revival including loan rescheduling, debt equity swaps, financial restructuring/re-engineering.

Recommend cases for change of management or re-privatization, appointment of administrators, action under Companies Ordinance and disposing of sick units.

Develop a monitoring system to identify early signals of weakness among industrial units and suggest measures to take preventive or legal actions that are necessary at an early stage.

Matter related or ancillary to the above and other matters assigned or referred to the committee by the Ministry of Finance.

The Committee for Revival of Sick Units revived 4 sick industrial units and handed over another 5 such units to banks for reappraisal on 31st May 2000.