Wednesday June 29, 2022

Rs650 bn allocated for PSDP with focus on Covid-19 response

June 13, 2020

ISLAMABAD: The government has allocated Rs70 billion for COVID-19 response and other natural calamities out of the Public Sector Development Program (PSDP) of Rs650 billion for the budget 2020-21, the budget document showed on Friday.

Some other major initiatives of next PSDP included $7.4 billion ML-1 project with an allocated amount of Rs6 billion including Rs500 million as foreign aid, Diamer Basha dam (for dam portion) Rs16 billion for the budget 2020-21.

According to PSDP document tabled before the Parliament, the PTI led government launched “COVID-19 Responsive and other Natural Calamities Control Programme”.

The COVID-19 responsive projects have been financed on priority for combating the adverse impact of the COVID-19 on the economy and society.

Under COVID-19 response, the projects having one-year gestation period with high impact on employment generation were given due priority to generate employment and quick benefits to the society. Projects related to public health services, maintained and expanded to COVID-19 response, were given preference for funding during FY2020-21. Only approved projects have been budgeted.

In the aftermath of COVID-19 and resource crunch, NHA& Railway have been advised to defer initiation of new schemes unless very critical and pay full attention on completion of ongoing projects.

In line with provisions of Public Finance Management Act 2019, no unapproved project has been included in PSDP 2020-21. Resultantly, 73 percent resources have been proposed for ongoing projects and 27 percent new approved schemes.

The total national development outlay for 2020-21 stands at Rs1,324 billion including federal PSDP of Rs650 billion and Provincial ADPs at Rs674 billion. The federal PSDP of Rs650 billion included foreign aid of Rs72 billion. Of provinces ADPs of Rs674 billion, the rupee component stands at Rs524 billion and foreign aid at Rs150 billion.

The projects having 80 percent plus expenditure have been fully funded in the PSDP. The projects with expenditures over 50 percent of the cost have been provided resources for scheduled completion.

China-Pakistan Economic Corridor (CPEC) and its supporting projects are projected for funding during FY2020-21 as per available fiscal space. As per above financing criteria, it is likely that by June 2021, 300 projects costing Rs237 billion would be completed.

The APCC appreciated the efforts of the MoPD&SI for initiating PSP+ and took note of that projects worth Rs300 billion with an investment of Rs50 billion would be initiated during FY 2020-21.

The development of less developed areas is the cornerstone of development policy of the government to help promote harmony and national integrity. Over the years, some regions/areas were left behind in the process of socioeconomic development due to various reasons.

Accordingly, special interventions have been made to enhance allocation of ongoing projects and financing of new projects in Balochistan, Merged Districts of Khyber Pakhtunkhwa and Gilgit-Baltistan. The allocations of Balochistan projects have been enhanced despite resource crunch from current years allocation. In consultation with the government of Balochistan various projects have been budgeted including dualisation and improvement of existing N-50 from Yarik-Zhob including Zhob Bypass, Jhal-Jhao Bela Section, Naukandi-Mashkhel in addition to other various road and water sector projects.

Similarly, to harness hydropower potential of Gilgit-Baltistan, all ongoing hydropower projects have been provided additional funds as compared to CFY. Likewise, in addition to annual development programme a 10-Year Development Plan for Merged Districts with an allocation of Rs24 billion is being financed.?