Rs848b national development budget recommended

Priorities committee sets Rs371b for federal projects, Rs475b for provinces.

ISLAMABAD: The Priorities Committee has recommended a Rs848 billion national development budget for the next financial year, which is 16.1% higher than the current budget, but still significantly lower than the demand of various ministries.

According to official documents, for the development budget, the country is expected to obtain foreign loans of Rs142.8 billion or 16.8% of the total to finance different projects. The development outlay is less than one fifth of the proposed federal and provincial budgets estimated at Rs4.4 trillion. Of this, the federal component is Rs2.73 trillion and provinces’ budgets are of Rs1.68 trillion.

An amount of Rs371 billion including an additional Rs21 billion has been suggested for federal development projects, which is 23.7% or Rs71 billion higher than the outgoing fiscal year’s development programme of Rs300 billion. It is also Rs21 billion more than the proposed ceiling of the finance ministry.

The federal government will borrow Rs90.8 billion or a quarter of the development budget from external sources.

Of the additional Rs21 billion, Rs12 billion has been sought for Pakistan Railways, Rs1.7 billion for the Defence Production Division, Rs2 billion for the interior ministry, Rs2 billion for Azad Jammu and Kashmir, Rs1 billion for Gilgit-Baltistan and Rs2 billion for the Planning Division.

Four provinces have set their development programmes at Rs475 billion, Rs45 billion higher than this fiscal year. Provinces will obtain Rs52 billion in foreign loans.

The Priorities Committee, a ministerial body that assesses financing requirements, has turned down requests for Rs379 billion, mainly from the water and power ministry, Pakistan Atomic Energy Commission and National Highway Authority due to resource constraints, say the documents. This may affect Chashma Nuclear Power Plants 3 and 4, Diamer-Bhasha Dam and some other major infrastructure projects.

The Annual Plan Coordi­nation Committee (APCC), headed by the Planning Commission deputy chairman, will consider the Priorities Committee’s recommendations in its meeting in the first week of May. The APCC will then send its recommendations to the National Economic Council (NEC), which will meet on May 11 under the chairmanship of Prime Minister.

Requests made by ministries

Against the fiscal space of Rs350 billion, the ministries had demanded a total of Rs750 billion. For land acquisition for Diamer-Bhasha Dam, the committee has suggested a Rs22 billion budget against the demand of Rs42 billion. An amount of Rs6 billion has been recommended for Mangla Dam raising project, Rs32 billion for Chashma 3 and 4 projects and Rs13 billion for road construction in Balochistan.

It has recommended Rs98 billion for NHA and Wapda including the power sector, Rs38 billion including an additional Rs3 billion for FATA, Azad Jammu and Kashmir and Gilgit Baltistan, Rs27 billion for parliamentarians’ schemes and Rs10 billion for the Earthquake Reconstruction and Rehabilitation Authority.

Published in The Express Tribune, April 27^th, 2012.