Annual plan coordination panel meets tomorrow to firm up PSDP

At the moment, the Ministry of Finance has indicated a development budget of Rs1,000 billion

By Our Correspondent
May 30, 2024
Workers are busy in construction work of Orange Line Metro Train Project at Allama Iqbal Road in Lahore. — APP/File

ISLAMABAD: The Annual Plan Coordination Committee (APCC) is scheduled to meet on Friday (tomorrow) to consider approval of either to allocate Rs1,250 billion or Rs1,500 billion for Public Sector Development Programme (PSDP) for the next budget.


At the moment, the Ministry of Finance has indicated a development budget of Rs1,000 billion and the government would incorporate Rs250 billion through Public Private Partnership (PPP) to show a ballooned figure of PSDP at Rs1,250 billion.

The Ministry of Planning wishes to jack up the PSDP up to Rs1,500 billion provided the Finance Ministry increases its allocation to Rs1,250 billion and then after incorporating the PPP mode financing of Rs250 billion, the overall size of PSDP could become Rs1,500 billion on the government’s board. The Higher Education Commission (HEC) development budget might be curtailed to Rs21 billion in the next fiscal year.

However, under the next PSDP for 2023-24, the prime minister’s directive of constructing 100 Danish Schools was expected to be made part of the next PSDP. The federal government would finance their construction in the Islamabad Capital Territory (ICT), Gilgit-Baltistan, AJK and selected districts of Balochistan. The federal government might have to seek an exemption from the Public Finance Management (PFM) Act for inserting the Danish School project into PSDP because under the PFM Act, the federal government could only incorporate those projects approved by relevant forums, including the Central Development Working Party (CDWP) and Executive Committee of National Economic Council (ECNEC) till March 31 of the last financial year.

The federal government will finance the Danish Schools to the tune of Rs14 billion. The Indicative Budget Ceiling shared by the Finance Ministry and forwarded to the ministries showed that the development budget of Power Division was proposed at Rs215 billion, SUPARCO Rs65 billion, Information Technology Rs25 billion, Railways Rs32 billion, Food Rs12 billion, National Highway Authority (NHA) Rs90 billion, Water Resources Rs413 billion, Higher Education Commission (HEC) Rs21 billion, Housing Rs26 billion and Climate Change Rs15 billion. The federal government has decided that it would not finance any new provincial nature development projects in the next fiscal year.

Against the total demand of Rs2,441 billion by ministries, divisions and attached departments for the development program at the federal level, the government will focus only on ongoing development projects and only focused areas projects for promoting exports, productivity, Information Technology, Water Resources and climate resilience related new projects could be inserted into the next PSDP. The government is going to finance Rs769 billion foreign-funded projects in the next fiscal year. There will be 136 development projects, which will be nearing completion in the next fiscal year. There will be around 380 ongoing other projects which will be focused in the next PSDP.

There is expected bloc allocation of Rs108 billion to be earmarked for various sectors in the next budget for 2024-25.