Central govt reduces GB budget, wheat subsidy

In a surprising development, the federal government has reduced the non-development budget and wheat subsidy to Gilgit Baltistan, where Pakistan Tehreek-e-Insaf (PTI) led government rules, for next fiscal year.

As per a letter sent to Government of GB, the Finance Division in Islamabad has informed that it has approved the new budget estimates for the region under which the non-development budget of the area has been fixed at Rs45 billion as compared to Rs47 billion of the ongoing budget (2021-2022) with a reduction of Rs2 billion.

Apart from the non-development budget, the Finance Division has also made a historic cut in wheat subsidy of GB as it has fixed only Rs4 billion against the existing subsidy of Rs8 billion making a 50 per cent reduction in the subsidy.

Though the reduction is made in the non-development budget of GB, the people of the area may strongly react to the major cut in subsidy which was introduced in the 1970s given the region’s high poverty index, lack of industry and significant agricultural land. The subsidy was first given by PPP’s leader Zulfiqar Ali Bhutto.

Previous government of PTI in the center had allocated an amount of Rs8 billion as wheat subsidy which was 33% more than the amount allocated in the budget of fiscal year 2020-21. 

It may be recalled here that various demonstrations had been held previously across GB against reduction or abolition of wheat subsidy.

Following the pressure from IMF for abolition of subsidies the finance ministry had also tried to reduce the subsidy or available quota but it was restored for political pressure.

Last year the Economic Coordination Committee (ECC) had also asked the GB government to increase the price of the commodity by 70 per cent to compensate for the additional cost of imported wheat supplied to the region. The demand of wheat in GB was currently 160,000 MT per annum.

Minister of Finance GB Javed Manwa while talking to this scribe said that the region would strongly object to the move of reducing even the existing budget and subsidy of the area. He said the regional government had asked/proposed the center allocating Rs 68 billion as non-development budget of GB for next financial year. However the center instead of increasing the budget is making a major cut in the existing budget, he added. 

With a population of 1.5 million spread over 10 districts, GB has no job opportunities, industry, infrastructure, fund allocations and other facilities that the rest of the country enjoys.

Meanwhile Chief Minister GB Khalid Khurshid, while talking to media here on Saturday, has also claimed that the center is going to make major cuts in the development budget too in the next fiscal budget. According to him, the Finance Division is likely to reduce the development budget from Rs18 billion to Rs10 billion only in the budget 2022-23. He termed the move as a conspiracy against development of the region.

He claimed that the government of multiparty in the center was taking such steps to punish the people of the area for voting PTI in the past election.


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Ghulam Abbas
Ghulam Abbas
The writer is a member of the staff at the Islamabad Bureau. He can be reached at [email protected]
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