Finance Division seeks Rs101.2bn for 44 provincial projects in FY21

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Ministry of Finance

ISLAMABAD: As the government faces with serious budgetary constraints, the Finance Division has sought Rs101.2 billion for at least 44 ongoing federally-funded provincial development projects in fiscal year 2020-21.

According to documents available with Pakistan Today, the ministry, which had earlier allocated Rs99.39 billion for 44 projects in FY20, has now proposed Rs101.2 billion with the additional allocation of Rs2 billion for the federal government’s funded projects, to be released in next financial year.

The Finance Division, under the rule 201 (6) of the Rules of Procedure and Conduct of Business  in the National Assembly 2007, has made the proposals related to Public Sector Development Program (PSDP) for the financial year 2020-21. The proposals, shared with the National Assembly recently, were, however, subject to change on receipt of Indicative Budget Ceiling from the Ministry of Planning and Development.

The province which is going to get a lion’s share in the federal PSDP of 2020-21 was Khyber Pakhtunkhwa in terms of financial allocation as the Finance Division has proposed Rs92.2 billion for only 10 projects. The Division had allocated Rs91.1 billion in the fiscal year 2019-2020.

As per the details, the finance ministry has projected Rs24 billion for the Annual Development Plan (ADP) of merged districts of KP for next fiscal year. The allocations for this fiscal year was also Rs24 billion.

Besides, the Finance Division has proposed Rs48 billion for merged areas of erstwhile FATA. Same allocation was made in this fiscal year. Under the program of relief and rehabilitation of internally displaced persons at least Rs17 billion have been proposed.

As per the official documents, the second major allocation was made for Balochistan by the center as it was funding to at least 27 projects out of the 44 projects being completed under federal PSDP. Around Rs6 billion were proposed for the same projects against the allocation of Rs5.3 billion the Finance Division had made in the ongoing financial year.

At least three projects are expected to be completed out of total 27 ongoing federally-funded provincial projects. Allocation of only Rs500 million was proposed for the desalination plant at Gwadar being set up under CPEC against the required Rs2.6 billion in the next fiscal year. An amount of Rs100 million was proposed for Gwadar Smart Environmental and Sanitation System and Landfill project of CPEC against the required Rs2.2 billion.

An amount of Rs1 billion has been proposed for another Gwadar project of fresh water treatment and water supply against expected minimum remaining requirement of Rs5.8 billion.

Dirge-Shaobai Road project will receive just Rs500 million against the total remaining requirement of Rs1.9 billion. For the Gwadar Development Authority project, the Ministry of Finance has proposed only Rs1 billion allocations against the required allocation of over Rs12 billion. However, the ministry has proposed Rs688 billion for the completion of the Gwadar Safe City project in fiscal year 2021.

According to documents, only five projects are being funded by the center in Sindh with the proposed allocation of Rs1.5 billion. The allocation for the same number of projects in Sindh in 2019-20 was Rs1.77 billion. The Greater Karachi Water Supply Scheme (K-IV) has also been proposed to receive Rs800 million against the centre’s remaining share of Rs2.4 billion.

The long awaited Lyari Expressway Resettlement project is projected to receive Rs50 million against the remaining requirement of Rs4.7 billion. Besides the establishment of a combined effluent treatment plant for the industrial area of Karachi will get only Rs500 million against the need for Rs2.9 billion.

Punjab, as per the documents, has only two projects to be funded by the center which has proposed allocation of Rs500 million in 2020-21 against Rs1.1 billion allocated in this financial year.

Overall, the Finance Division was providing funding to the provincial governments for 54 projects included in the federal PSDP.

According to officials, the expected remaining financing requirements are worked out by the Ministry of Finance on the basis of actual spending by December last year and projected allocation for the second half of this fiscal year.

The government faces serious budgetary constraints, as about three-fourth of the total budget is spent predominantly on debt servicing and then on defence of the country, they add.

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