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November 10, 2019

Government disburses 37pc of PSDP fund

Business

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November 10, 2019

ISLAMABAD: The government has released more than 35 percent of funds earmarked under the annual public sector development program in line with its new disbursement process to expedite uplift projects, official data showed.

The Planning Commission has so far released Rs257.436 billion, including Rs53.62 billion foreign aid for various ongoing and new development projects, out of the total allocation of Rs701 billion, under the public sector development program (PSDP) of 2019/20.

The government earlier this week announced change in the budget release process to speed up development projects as a country’s key foreign loaner World Bank raised concern over delay in execution of development projects and underutilisation of PSDP funds. The government decided to release half of PSDP allocations during the first half of fiscal year. The initiative is aimed at easing fund flow and to remove bottlenecks and boost economic development.

PSDP data showed the commission released Rs114.199 billion – including Rs7.88 billion in foreign aid for development projects of different federal ministries – compared with the total allocation of Rs303.66 billion for the current fiscal year.

Meanwhile, Rs85.430 billion was released for development projects of various corporations. The government disbursed Rs80.029 billion for the National Highway Authority out of Rs154.966 billion allocated in the current year’s development agenda. An amount of Rs26.78 billion has been released for security enhancement compared to Rs32.500 billion of the budgeted allocation.

Under PSDP 2019/20, the government authorised release of Rs10.640 billion for Azad Jammu and Kashmir, including Rs854.610 million of foreign aid components, compared to the allocation of Rs27.284 billion. An amount of Rs6.571 billion out of Rs17.585 billion was also released for different development projects in Gilgit-Baltistan.

The government further authorised release of Rs30.21 billion for different water resource development projects to enhance water resource development, compared to the total allocation of Rs85.72 billion during the current fiscal year.

Authorisation to release Rs15.994 billion was given for the cabinet division compared to the total allocation of Rs39.98 billion for the current fiscal year, while the government okayed Rs11.51 billion for the Higher Education Commission compared to the total allocation of Rs29.046 billion.

Previously, the commission was following a fund disbursal mechanism under which 20 percent each of PSDP funds were disbursed in the first and second quarters and 30 percent each in third and fourth quarters.

“Now 50 percent funds are available for the first two quarters, without any complication. The quarter wise release will be 20:30:30:20,” the finance ministry said in a statement this week. “Half of the budgetary allocations for approved PSDP projects have been made instantly available to the ministry of planning and development by revising finance division’s release strategy.”

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