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ISLAMABAD:
The National Economic Council (NEC) on Monday approved Rs2.1 trillion for the national development outlay, as the federal government allocates nearly two-third of its budget for infrastructure projects to satisfy unhappy parliamentarians and meet national needs.

The meeting of the NEC – the constitutional economic decision making body, was marked by agitation by the Sindh chief minister over what he called “unjust treatment” being meted out to his province in allocations of budgetary resources.

The NEC approved Rs2.1 trillion national development outlay, which is higher by Rs535 billion or one-third over this year’s original budget.

The four provinces will spend Rs1.235 trillion from their own resources while the federal government has allocated Rs900 billion for the federal Public Sector Development Programme (PSDP). The proposed federal PSDP is higher by Rs250 billion or 38% over this year’s original budget of Rs650 billion.

The Pakistan Tehreek-e-Insaf (PTI) seems to be changing its course and has adopted a strategy in allocation of the development budget, which was the hallmark of its arch political rival – the Pakistan Muslim League-Nawaz (PML-N).

It has allocated 63% of total PSDP or Rs565 billion for infrastructure sector, according to the Ministry of Planning summary for the NEC. The health sector got only Rs30 billion or 3.3% and education sector Rs50 billion or 5.5% of the federal development budget.

The parliamentarians schemes have been given Rs68 billion but for Covid-19 Rs5 billion have been earmarked for next fiscal year. The agriculture sector has been given Rs12 billion or 1.3% of the budget.

Within infrastructure, proposed allocation for transport & communication sector is Rs307 billion or 34% of the total size. However, the Prime Minister Office’s handout showed the transport sector allocation at Rs244 billion.

The planning ministry summary showed that water sector allocation stood at Rs91billion or 10% as per commitment made under the National Water Policy. The energy sector’s proposed allocation is Rs118 billion or 13% of the total size. The physical planning & housing sector will get Rs49 billion ie 5.5% of the total size.

The Rs900 billion federal PSDP was equal to just 60% that the ministries had demanded for development activities for this fiscal year. The Ministry of Planning informed the NEC that ministries sought an allocation of Rs1.5 trillion. However, in its APCC summary, the planning ministry had showed demand at Rs2.5 trillion.

The government has approved 72% or Rs648 billion resources for ongoing projects and 28% new approved schemes.

Sindh Chief Minister Syed Murad Ali Shah complained that Sindh had been given only Rs1.5 billion while Punjab had been allocated Rs44 billion for provincial projects that are financed by the federal government.

Prime Minister Imran Khan maintained that no discrimination was meted out to Sindh in allocation of resources.

Actual utilisation

For the outgoing fiscal year, the government had allocated Rs650 billion under the PSDP. “An expenditure of Rs422 billion was reported as of June 3, 2021,” the NEC was informed. The planning ministry maintained that it is expected the entire allocated funds of Rs650 billion would be utilised by June 30, 2021.

However, the Rs422 billion utilisation was 65% of the total budget and the planning ministry is unrealistically expecting to spend Rs228 billion at a rate of Rs8.4 billion per day in the remainder period of this fiscal year. The utilisation of development funds remained on average at Rs1.24 billion a day during this fiscal year.

The planning ministry informed the NEC that it allowed inter and intra sectoral adjustment to the tune of Rs127 billion to various projects primarily to fast track projects implementation and support high impact initiatives.

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