Govt scraps 24% of development projects, utilises Rs312bn out of Rs1,100bn PSDP budget in eight months

In a surprising move, the federal government has decided to eliminate approximately 24% of the ongoing development projects under the Public Sector Development Programme (PSDP) for the current fiscal year, The News reported. 

Out of 1,092 projects listed under the PSDP, which are expected to require trillions of rupees over the coming years for completion, 260 development schemes, totaling billions of rupees, will be abolished. 

The Planning Ministry has established specific criteria for selecting which projects will be scrapped, focusing on streamlining the list for better resource allocation. 

According to the report, Minister for Planning, Ahsan Iqbal, confirmed the decision, emphasizing that the move would not be driven by political factors. He pointed to the successful completion of the NED University project as an example of timely execution, which he argued should be the focus of future development efforts.

The overall PSDP allocation for the current fiscal year is Rs1,100 billion, including Rs843.145 billion for ministries and divisions and Rs255.854 billion for public corporations. 

However, official data reveals that by the end of February, only Rs631 billion had been authorised, and a mere Rs312.3 billion had been utilised, leaving much of the budget underused in the first eight months of the year.

While the planning minister acknowledged the slow pace of fund utilisation, he assured that the process would accelerate in the final quarter of the fiscal year (April-June). 

He stated that the Finance Ministry has yet to finalise the resource envelope for the upcoming development budget, although the Planning Ministry estimates that between Rs2,500 billion and Rs2,900 billion would be required to meet the nation’s increasing development needs.