NEC approves budget through video link

PM’s heart surgery to be performed today; all tests conducted ahead of surgery; PM signs all budget documents; prayers for PM’s speedy recovery held throughout country; NEC approves development budget of Rs1,675 bn; Rs800 bn approved under PSDP; Rs875 bn allocated for provinces; GDP growth estimated at 5.7pc

ISLAMABAD: The National Economic Council (NEC) under the chairmanship of Prime Minister Nawaz Sharif through a video link from London approved the budget 2016-17, jacking up development funds by 20 percent to Rs1,675 billion against revised development funding of Rs1,410 billion for the outgoing financial year.

After the budget’s approval, the prime minister was to be taken to hospital for open heart surgery to be conducted today (Tuesday). All the necessary medical tests ahead of the surgery have been completed. The prime minister has now signed all the documents related to the budget.

The NEC meeting approved the constitution of a special forum for Fata development under the chairmanship of the Commander 11 Corps. For the first time in the country’s history, the prime minister chaired the NEC meeting through video link from Pakistan’s High Commission London as the highest constitutional economic decision-making body approved the federal Public Sector Development Programme (PSDP) of Rs800 billion, provincial development outlays of Rs875 billion and validating macroeconomic framework, including GDP growth at 5.7 percent, for the next budget 2016-17.

According to the presentation approved by the NEC, the government is committed to the immediate rehabilitation of internally displaced persons (IDPs) in Fata through permanent reconstruction projects with the help of the Pakistan Army.

On the recommendation of the Fata Secretariat and Safron Division, the constitution of a special forum under the chairmanship of commander 11 Corps was approved. The forum is empowered to approve projects for reconstruction and rehabilitation up to Rs1,500 million. These powers will cease at the end of December 2018.

For the renaming of the Fata Council, the NEC approved the Fata Development Council comprising elected and technical persons, which is being constituted by the Fata Secretariat to monitor and supervise rehabilitation and reconstruction projects in Fata.

It necessitates the renaming of the existing Fata Development Council for the approval of development projects up to Rs400 million as the Fata Development Committee for the sake of clarification.

The NEC approved the GDP growth target of 5.7 percent along with sectoral growth rates of agriculture (3.5), industry (7.7) and services (5.7) for 2016-17. The GDP size on the basis of market price is projected at Rs33,507 billion for 2016-17 against Rs29,598 billion. Inflation is projected at six percent for the upcoming budget 2016-17 against 3.5 percent for the outgoing financial year.

For the PSDP for 2016-17, thefederal share for upcoming budget including Rs655 billion for federal ministries/divisions, Rs100 billion for TDPs, Rs20 billion for Prime Minister’s Skill Development Programme and Rs25 billion as Gas Infrastructure Development against revised development utilisation of Rs669 billion in outgoing fiscal year.

The provincial development outlays approved by NEC stands at Rs875 billion for upcoming budget against Rs732 billion for outgoing financial year. Of total PSDP allocation, the NEC approved Rs467 billion for infrastructure projects in upcoming budget against revised estimates of Rs408 billion in outgoing fiscal year. In infrastructure, the federal PSDP allocated Rs157 billion for power sector (in addition, Rs175 billion invested in energy sector by Wapda/NTDC/Pepco through self-finance making total energy sector allocation at Rs320 billion), transport and communication Rs260 billion, water Rs32 billion, physical planning and housing Rs18 billion in upcoming budget.

For social sector, the NEC approved Rs90 billion for next budget against Rs81 billion for outgoing fiscal year. Of total allocation of social sector, the government allocated Rs29 billion for Higher Education Commission (HEC), health and population Rs30 billion, SDGs Rs20 billion and other social sectors Rs11 billion.

The NEC approved Rs9 billion for Science and IT, Rs8 billion for governance, special areas like AJK, GB and Fata Rs42 billion, production Rs4 billion, industries Rs2 billion, food and agriculture Rs2 billion, Erra Rs7 billion and special federal development programmes Rs28 billion for upcoming budget.

For federal ministries/divisions, the government allocated Rs4.695 billion for Aviation Division, Rs369 million for Cabinet Division, Rs2.562 billion for Capital Administration and Development, Rs2.027 billion for Climate Change Division, Rs797 million for Commerce Division, Communication Division (other than NHA) Rs5.285 billion, Defence Division Rs2.527 billion, Defence Production Division Rs2.3 billion, Establishment Division Rs137 million, Federal Education and Professional Training Division Rs2.221 billion, Finance Division Rs9.002 billion, Foreign Affairs Division Rs500 million, HEC Rs21.486 billion, Housing and Works Rs6.4 billion, Human Rights Division Rs170 million, Industries and Production Rs910 million, Information and Broadcasting Rs335 million, Information Technology and Telecommunication Rs1.109 billion, Interior Division Rs11.554 billion, Kashmir Affairs and GB Rs25.7 billion, Law and Justice Division Rs1.5 billion, National Health Services Rs24.951 billion, Pakistan Atomic Energy Commission (PAEC) Rs27.5 billion, Pakistan Nuclear Regulatory Authority Rs271 million, Ministry of Petroleum and Natural Resources Rs587 million, Planning and Development Rs11 billion, Railways Rs41 billion, States and Frontier Region Rs22.3 billion and Water and Power Division Rs31.066 billion in 2016-17.

For National Highway Authority (NHA) the allocation for road network stood at Rs188 billion and Wapda Rs130 billion.

For major projects, the NEC was informed that the government allocated Rs60 billion for 1200 x 2MW LNG based power plant at Baloki and Haveli Bahadurshah, Rs61.453 billion for Neelum-Jhelum Hydro Power Project (969 MW), Rs42.177 billion for Dasu hydropower project, Rs32 billion for Diamer Bhasha dam, Rs22.3 billion for Chashma Nuclear Power Plant including C-3 and C-4 (300 MW each), Rs19.061 billion for  new coal fired power plants having capacity 2x660MW at Jamshoro, Rs16.487 billion for Tarbela Fourth Extension Hydro Power Project (1,410MW) (Swabi) and Rs5 billion for Kachhi Canal (Phase-I) (Dera Bugti).

For highways and other communication projects, the government allocated Rs19 billion for Multan -- Sukkur Section (387 km) Credit Financing (90:10), Rs34 billion Lahore-Abdul Hakeem (230 KM), Rs14 billion for procurement/manufacture of 75 Nos. New DE Locos. 

The government approved Rs22 billion for construction of Burhan-Hakla on M-I to Dera Ismail Khan Motorway under the China-Pakistan Economic Corridor (CPEC) initiative out of total estimated cost of Rs124 billion.

For land acquisition, the affected properties compensation for construction of Burhan-Hakla to DI Khan Motorway, the government proposed allocation of Rs1.771 billion in the PSDP for 2016-17 out of total estimated cost of Rs11.793 billion. The government approved allocation of Rs5 billion for Gwadar-Turbat-Hoshab Section (200 km) of Gwadar-Ratodero Road (892 km) M-8 against total estimated cost of Rs23.169 billion.

The government allocated Rs4 billion for widening and Improvement of N-85, Hoshab-Nag-Basima-Surab Road (459 km) against total estimated cost of Rs22 billion. The government also allocated Rs1.1 billion for Zhob Mughal Kot 81 km N-50 in upcoming PSDP for 2016-17 against estimated cost of Rs9.1 billion.

For rehabilitation of DI Khan Mughal Kot 50 km section N-50 (FERP Phase-II), the government made allocation of Rs1.150 billion in the coming budget against estimated cost of Rs4.02 billion. For Northern alignment, the government proposed allocation of Rs4.561 billion for construction of Burhan-Havelian Expressway (E-35) 59.1 km against total estimated cost of Rs39.4 billion.

The government also proposed allocation of Rs16.5 billion for Thakot to Havelian 120 km construction (Phase-I) (CPEC) against total estimated cost of Rs136.6 billion. For land acquisition for Thakot to Havelian, 120 Km (land) (Phase-I) (CPEC), the government proposed allocation of Rs1.858 billion.

The NEC also approved total investment projection to the tune of 17.7 percent of GDP for 2016-17 against 15.2 percent for outgoing financial year while national savings will go up to 16.2 percent of GDP against 14.6 percent in 2015-16. The foreign savings is aimed at 1.5 percent of GDP in upcoming budget against 0.6 percent for outgoing fiscal year.

The trade deficit is projected to be increased to $20 billion in upcoming budget against $17 billion in outgoing financial year. The current account deficit will be widened to negative $4.5 billion in 2016-17 against $1.7 billion in outgoing fiscal year. The current account balance in percentage of GDP will be expanded to 1.5 percent of GDP in upcoming budget against negative 0.6 percent of GDP in 2015-16.

  Agencies add: Prime Minister Nawaz Sharif said the effective economic policies of the government were coming to fruition with all the economic indicators showing positive trend including growth rate, inflation, fiscal deficit and tax receipts.

"After three years, our policies are bearing fruits. Investors' confidence is rising. All economic indicators are showing positive trends. The economic growth rate is eight-year high. Inflation has downed below three percent. Fiscal deficit is below 4.3 percent. Tax receipts have shown an exemplary surge of 56 percent comparing to those of fiscal year 2013," the prime minister remarked while addressing the meeting of the federal cabinet.

The cabinet meeting, presided over by prime minister, considered and approved the budget and taxation proposals for the fiscal year 2016-17.

The prime minister said the government had prepared its fourth budget which, on one side indicated continuity of economic policies, while on the other, reflected the continuous progress and prosperity of the people.

“The government has inherited fragile and instable economy with high fiscal deficit, low investment and energy crisis that had destroyed the industrial sector besides afflicting psychological impact on the masses,” he said. But, he said, the government was not perplexed by these issues, rather it formulated comprehensive policies and pursued those with responsibility, commitment and honesty.

Thanking the nation, the prime minister said their prayers during his illness were the biggest asset for him. He said their prayers helped him pass through some critical and difficult times. He also thanked the elders, mothers, brothers, sisters and youngsters who showed their sincere emotions and wished him early recovery. He was also grateful to the leadership of the political parties for extending good wishes.

Nawaz Sharif said his all energies were dedicated for soil of the country, adding that each drop of his blood and every breath would be fulfilling responsibilities enshrined to him. He said he was dreaming for such a Pakistan which was free from poverty, backwardness and illiteracy.

The prime minister specially asked the finance minister to announce special package for farmers and give substantial subsidy on urea. He said the government had already announced relief package to the farmers. He said that it would be the great achievement of his government to mitigate problems of the farmers.

The cabinet offered prayer for health and early recovery of the prime minister. Meanwhile, spokesman for the prime minister Dr Musaddik Malik said Nawaz Sharif did not allow his illness to come in the way of fulfilment of his official responsibilities and chaired the meetings of the federal cabinet and NEC through video link just 14 hours before his heart surgery.

Talking to media persons at the PM House, he said the prime minister was in high spirit and chaired the cabinet meeting just 14 hours before his surgery to save every single minute of the nation. He said the prime minister's pre-operation tests have already been conducted and surgery procedure would start at 08:00 hours (UK time) today (Tuesday). Nawaz would stay at the hospital for a few days after surgery and later he would be shifted to his home.

The spokesman said that they would be kept updated about the details of the prime minister's treatment as well as schedule of PM's return as to be advised by the doctors. Dr Musaddik Malik said world's best doctors including the prime minister’s personal physicians were part of the medical team; however, he said the hospital's name could not be disclosed due to security reasons. He said though the prime minister would be undergoing a heart surgery but the doctors have assured that it was a routine operation.

The spokesman said on doctors' advice, the prime minister was spending some time with his family members in London but some people took the pictures and posted on social media with some sarcastic comments that was unfortunate and condemnable. He said the prime minister was thankful to the nation including elders, men, women and youngsters for praying and extending good wishes for his early recovery.

Meanwhile, Nawaz Sharif telephoned Indian Prime Minister Narendra Modi and expressed gratitude for wishing him a speedy recovery. A number of world leaders had wished the prime minister health and a quick recovery. Earlier, prayer ceremonies were held throughout the country for early recovery of the prime minister.