Govt raises PSDP allocation for CPEC to Rs193 billion

ISLAMABAD: Pakistan Tehreek-e-Insaf-led government revised up development allocations for the China-Pakistan Economic Corridor (CPEC) projects to Rs193 billion for the current fiscal year of 2018/19 compared to the previous allocation of Rs191 billion, official documents revealed on Wednesday.

The government also abolished all the unapproved projects of CPEC from the list of public sector development program (PSDP) for 2018/19.

Official documents available with The News showed that the government also abolished all the unapproved projects irrespective of the grants of exemption.

“So all those CPEC projects having status of unapproved were also abolished through the rationalisation of PSDP exercise,” a top official said. “As and when the competent forum grants approval to CPEC projects, the government will make available all the required funds for the projects.”

The CPEC projects that the government scrapped include Shandur-Chitral road, Zhob-Kuchlak road including land acquisition, up-gradation of 50- to 300-bed hospital at Gwadar, construction of northern bypass, including fencing of 77.5 kilometres, Gwadar smart environment and sanitation system and landfill, land acquisition for Gwadar port master plan under Maritime Affairs Division, and feasibility study (PC-II) for construction of new rail link from Havelian to Pakistan-China border.

Secretary Ministry of Planning Zafar Hasan said the rationalisation exercise of PSDP removed variation between amounts allocated by the finance ministry in pink book and the planning ministry in green book for 2018/19.

In the budget announced by the Pakistan Muslim League (Nawaz) government for FY2019, the allocation for CPEC projects stood at Rs172 billion as mentioned by the finance ministry, whereas the planning ministry earmarked Rs191 billion in the green PSDP book for the current fiscal year.

“This variation has been removed now after which the allocated amount for CPEC projects stood at more than Rs193 billion in the PSDP for the current fiscal year,” Hasan added.

Size of the federal PSDP was slashed to Rs675 billion from Rs1.001 trillion in the mini budget. The new government presented Finance Supplementary (Amendment) Bill 2018 to introduce changes in the current fiscal year’s budget. National Assembly on Wednesday enacted the bill into law.

Of the revised-down development spending of Rs675 billion, a major chunk of resources was allocated for infrastructure uplifts. The government earmarked Rs406.631 billion for infrastructure development.

Of the total allocation for infrastructure development, the government earmarked Rs72.685 billion for energy, Rs250.837 billion for transport and communication, Rs64.244 billion for water sector and Rs18.866 billion for physical planning and housing.

The government allocated Rs62 billion for social sector, Rs7.92 billion for science and information technology, Rs11.755 billion for governance, Rs61.5 billion for special areas and Rs3.029 billion for production sectors.

For federally-administered tribal areas’ 10 year plan, the federal government will contribute Rs10 billion under PSDP in the revised budget for the current fiscal year.

The government has already brought down the estimated cost of expansion and reconstruction of 1,872 km Main Line-I (ML-1) that runs from Peshawar to Karachi track under the CPEC to $6.2 billion from $8.2 billion.

The ML-1 is the spine of the country’s dilapidated rail network, as well as the biggest source of revenue. Pakistan’s rail system has struggled to break even for decades as passenger numbers plunge, train lines close and the vital freight business nosedives.