National development outlay of Rs2,101b to be approved

ISLAMABAD: With proposed allocation of Rs62 billion for CPEC projects, including a meager allocation of just Rs7 billion for much-awaited Mainline (ML-1), the National Economic Council (NEC) is all set to approve the national development outlay of Rs2,101 billion for the next budget on coming Monday.

The NEC is scheduled to meet under the chairmanship of Prime Minister Imran Khan on coming Monday. Out of the total estimated cost of Rs1.1 trillion for construction of much-awaited railways Mainline-1 under CPEC projects, the government is going to allocate just Rs7 billion in the upcoming budget. Official sources said that the financing of ML-1 was not yet finalized with the Chinese side, so the government preferred to keep token allocation to make this project part of the Public Sector Development Program (PSDP). The cost of ML-1 has been estimated at Rs 1.1 trillion. According to official documents, the national development outlay was proposed at Rs2,101 billion, including federal PSDP of Rs900 billion and provincial annual development outlay of Rs1,201 billion for the coming budget. Out of the total federal PSDP of Rs900 billion, the rupee component stands at Rs799 billion and foreign aid Rs101 billion. The provincial ADPs will comprise Rs1,201 billion out of which Rs1,009 billion will be earmarked as rupee component and Rs192 billion as foreign aid. The government is all set to earmark Rs526 billion into the PSDP for ministries, Rs167 billion for corporations such as NHA-WAPDA and Power, Rs45 billion for Special Areas in AJK and GB, Rs54 billion for merged districts of Khyber Pakhtunkhwa, SDGs and other initiatives Rs74 billion and Rs34 billion for packages. The government is considering to reduce allocation of SDGs from Rs74 to Rs46 billion as development schemes are executed through recommendation of parliamentarians. The NEC will also consider approval of proposed policy for financing of provincial projects, so it is recommended that the PSDP funding should be restricted only for deprived areas, there should be equal provincial contribution, PSDP funding for capital investment only, provinces to fund land acquisition, resettlement, provincial taxes and cost of PMU, financing of any subsequent change in scope and cost would be responsibility of the province, provincial governments to take over projects on completion immediately and simultaneous development of command area in case of irrigation projects.