ISLAMABAD: Amid the demand by the provinces to address their development woes, the National Economic Council (NEC), under the chairmanship of Prime Minister Mohammad Nawaz Sharif, on Monday approved a total development outlay of Rs1,513.7 billion, including the federal development share of Rs700 billion and provincial allocation of Rs813.7 billion for the budget 2015-16. The council also approved the deletion of hundreds of those development schemes which were dragging on for more than five years and having a throw forward of Rs15 million from the Public Sector Development Programme (PSDP) list. Such projects would, however, be provided funds for meeting the essential requirement within the already approved cost and scope. The council also approved allocation of funds for vertical projects of the social sector till the next NFC was finalised for a resource distribution formula among the Centre and the provinces. Out of Rs700 billion for the federal PSDP, the committee approved Rs100 billion for special development programmes for temporarily displaced persons (TDPs) and security enhancement, Rs20 billion for the Prime Minister’s Youth Programme including laptop programme and fee reimbursement initiatives for students, Rs266 billion for ministries/divisions, Rs256.3 billion for corporations (NHA and WAPDA), Rs30 billion for federal development programmes, Rs20 billion for MDGs community development and Rs7 billion for the Erra. According to the approved summary for the development outlay for 2015-16, the Finance Division under the Medium Term Budgetary Framework conveyed the indicative ceiling of Rs700 billion for the federal PSDP with an increase of about 29 percent over the revised size of PSDP for 2014-15 at Rs542 billion against the original target of Rs525 billion. Of the total Rs700 billion PSDP, the rupee component Rs553.7 billion and foreign aid Rs146.3 billion while out of Rs813.7 billion provincial development outlay, the rupee component would be standing at Rs728.2 billion and foreign aid of Rs85.5 billion. The NEC approved the official summary that ongoing projects would be financed on priority for their early completion, new projects would be taken based on their potential for generating higher growth and jobs, foreign assisted projected would be adequately funded, financing China-Pak Economic Corridor (CPEC) projects to realize Chinese support and ensuring completion of early harvest projects in the next three years. The salient features of PSDP 2015-16 show that total 938 projects/programmes costing Rs5.2 trillion would be financed during 2015-16.Estimated expenditures of these projects up to June 30, 2015 are Rs1.4 trillion, thereby placing a throw forward at Rs3.7 trillion. Of these, 273 new projects costing Rs1.5 trillion are being financed during the 2015-16. In addition, 83 projects of power sector that will be financed by the sponsoring agencies from their own resources also reflected in the PSDP.The government is going to utilise Rs394.3 billion on infrastructure during 2015-16 having share of 56.3 percent in the federal PSDP share out of which Rs278 billion will be utilized on power sector, self-finance for power sector Rs174.9 billion, transport and communication Rs245 billion, social sector Rs70 billion or 10.1 percent share in PSDP out of which Rs20.5 billion will be spent on Higher Education Commission (HEC), Rs17.7 billion on health and Rs32.2 billion on other projects. On Science and Technology, the government will utilise Rs7 billion from the PSDP having share of 1 percent, governance Rs8.4 billion having share of 1.2 percent in overall PSDP allocation, special areas (AJK, GB and FATA) Rs38.7 billion, having share of 5.5 percent in PSDP, special programmes Rs50 billion or 7.1 percent share in PSDP, Erra Rs7 billion and special programmes for TDPs and security enhancement Rs100 billion or share of 14.3 percent. The federal government will spend Rs700 billion, including foreign aid of Rs146.3 billion. The provincial governments planned their development programme at Rs813.7 billion while Wapda, Pepco and NTDC will invest Rs175 billion from their own resources. The approved summary for NEC states that since the western alignment of CPEC is to be taken up and developed on priority, substantial allocation has been reflected for various sections.Under this alignment, the projects include Gawadar-Turbat-Hushab (200 km) of Gawadar-Ratedero (892 km) costing Rs23.2 billion, widening & improvement of 185km Hushab-Nag-Basima-Surab (459 km) costing Rs22.4 billion, Zhob-Mughal Kot 81 km, N50 costing Rs9.1 billion, rehabilitation of DI Khan-Mughal Kot costing Rs4 billion. In addition, Rs10 billion has been allocated. An additional Rs10 billion allocated for study/land acquisition of Hassan Abdal to D.I Khan under CPEC alignment.The work on northern alignment of the CPEC route will also be initiated during 2015-16. A sum of Rs31.8 billion has been earmarked for these projects, which are estimated cost of Rs143.3 billion and these funds are for construction of Burhan-Havelian expressway (59 km) and Thakot to Havelian 120 km. In the wake of possibility of signing Sustainable Development Goals (SDGs) at UN level, the government has approved cost of MDGs project up to Rs20 billion for 2015-16 against Rs12.5 billion for outgoing fiscal year. The NEC also authorized the Planning Commission to make adjustments to the detailed PSDP for optimizing During the NEC meeting, Prime Minister Nawaz Sharif asked reasons for slightly missing out GDP growth target for outgoing fiscal saying that what would be the possibility for achieving envisaged GDP growth target of 5.5 percent for next financial year. Chief Minister Punjab Mian Shahbaz Sharif also raised question about the performance of the national economy and said there was need to focus on higher growth. Finance Minister Ishaq Dar told the NEC that the government concentrated on stabilization of economy as its top priority and brought down the fiscal deficit significantly but now higher growth trajectory would be the main focus of the government in years to come. Chief Minister Sindh Qaim Ali Shah also raised different issues being confronted by the province at the NEC forum. When it was mentioned that the federal government was financing the Lahore-Karachi Motorway project, the CM Sindh replied that it would be used for transportation of goods from Karachi port to Lahore and other parts of Punjab. All provincial finance ministers spoke during the NEC meeting except KP’s finance minister who preferred to keep mum during the whole meeting.For outgoing fiscal year 2014-15, the NEC was informed that the revised estimates for development outlay stood at Rs1188 billion against initial allocation of Rs1175 billion. The federal PSDP was revised upward to Rs542 billion against allocated amount of Rs525 billion while the provincial development utilization stood at Rs646 billion in accordance with revised estimates for 2014-15 against allocated amount of Rs650 billion. The request for re-appropriation of funds from slow moving projects was duly met and an amount of Rs29.7 billion was re-appropriated. As a result of these efforts, 189 projects of various sectors are expected to be completed by June 2015. According to announcement made by PM Secretariat on Monday, the NEC chaired by Prime Minister Muhammad Nawaz Sharif at the PM Office approved GDP growth target of 5.5% for financial year 2015-16 and Rs.514 trillion development outlay including Rs700 billion as federal PSDP and Rs814 billion as provincial Annual Development Programme (ADP). Growth target for 2015-16 for agriculture sector has been set at 3.9%, 6.1% for manufacturing sector, while exports target has been set as $25.5 billion. The meeting was given an overview of the state of country’s economy in 2014-15 in addition to being briefed about budget outlay for financial year 2015-16. The meeting approved macroeconomic framework for Annual Plan for 2015-16. Progress report of CDWP from April 2014 to March 2015 was also presented before the NEC and Planning Commission was authorized to publish the 11th five-year plan. The prime minister directed that funds for projects being funded by the federal government should be properly allocated to priority projects in complete coordination with provincial governments to ensure optimum utilization of funds and to reduce chances of duplication. The chief ministers of all the four provinces, governor KP, CM Gilgit-Baltistan; ministers for finance, planning and water & power; finance ministers of all provinces as well as AJK and secretaries for ministries for finance and planning attended the meeting along with other senior government officials.
