ISLAMABAD – The federal government has decided to immediately release one million tonnes of wheat to utility stores corporation, local traders and flour mills to check the rising prices of the commodity and discourage hoarding.The wheat and flour prices have shown massive increase in the last couple of weeks, as price of 20kg flour bag has surged to over Rs750 from Rs640. Moreover, there is severe shortage of wheat and flour in some parts of the country despite increase in its prices.The Economic Coordination Committee (ECC) of the cabinet, which met under the chairmanship of Finance Minister Dr Abdul Hafeez Shaikh on Thursday, was informed that there is no shortage of wheat stock in the country and ample stocks of the commodity were available.Terming the current price hike of wheat flour (atta) artificial and speculative, the ECC decided to immediately release to the provincial governments, through utility stores corporation, and to local traders and flour mills a total of one million tonnes of wheat at a price of Rs1,050/40 kg of wheat from crop year 2009-10 and Rs1,100/40kg of wheat from crop year 2011-12.The ECC further decided to form a committee comprising National Food Security Minister Mir Israrullah Zehri, Science and Technology Minister Changez Khan Jamali, Minister of State for Production Khawaja Shiraz, Special Assistant to Prime Minister Kamal Majeedullah and National Food Security secretary to explore avenues through provincial governments to ensure availability of required wheat.The ECC approved the summary of allowing export of sugar by providing a reduced rate of federal excise duty leviable on local supply of sugar at 0.5 percent instead of 8 percent. The reduced rate of duty shall only be applicable on the quantity of local sale of sugar equivalent to the quantity exported by the sugar manufacturers in accordance with the export quota allotted and shall be available on submission of proof of such export. The balance local supply shall continue to be subject to Federal Excise Duty at the rate of 8 percent.Sources said that Sugar industry would get extraordinary fiscal incentives of about Rs8 billion from the government under the sugar export policy. The ECC approved a summary by the commerce ministry seeking approval for grant of freight subsidy to facilitate the export of sugar. The ECC approved Rs1.75 per kg subsidy, which will be provided from export development fund.In order to overcome the shortage of natural gas for industrial sector, the ECC also approved injecting of LPG air-mix equivalent to 50 MMCFD gas into dedicated network for provision to industrial sector. The price impact will be borne by the industrial sector only and the domestic consumers will not be affected, according to officials.The ECC also approved a summary by the finance division seeking abolition of investment limits for NIT-State Enterprise Fund. With the approval of the summary NIT has been allowed to trade freely in order to keep balance in the prices of 8 listed companies in which the government has substantial share holdings.Water and Power secretary briefed the ECC over the energy situation in the country. It was informed that there is a generation of 8,500mw in the country against a demand of around 1,2000mw. Hence, there is a shortage of 3,500mw.The finance secretary gave a detailed presentation to the ECC on the state of economy. He claimed that despite the global financial crisis, heavy floods, high oil prices and bad security situation, the government has been able to maintain macroeconomic stability in the country. He also said that there has been unprecedented increase in exports and foreign remittances during the last four years. The revenue collection is also at the record level and during the last six month there is an increase of 7.1 percent, he added.The government has disbursed Rs218 billion through BISP and Baitul Mal while there has been 120 percent increase in pay and pension of employees during the last four years, he said, adding that inflation rate which stood at 25 percent in 2008-09 has now been brought down to 9 percent. The growth rate has increased from 1.7 percent in 2008 to 4.3 percent projected for year 2012-13. Agriculture sector also showed growth from 0.6 percent in 2008 to 3.8 percent projected for year 2012-13.