Budget 17-18: More focus on CPEC than water, education, health sectors combined

ISLAMABAD: Though Finance Minister Ishaq Dar claimed that well-being of common people and resolution of their issues would be top priority of budget 2017-18, the collective allocation for health, education, water sector and Sustainable Development Goals (SDGs) is less than the fund fixed for the China Pakistan Economic Corridor (CPEC), in the next budget.

The budget documents of the financial year 2017-18 reveal that the allocation of Rs 180 billion for CPEC projects is 0.83 per cent higher than the collective allocations for SDGs, water, education and health sectors—3.17 per cent of the total budget outlay.

With an obvious priority, the federal budget 2017-18 has earmarked Rs 180 billion, 4 per cent of the total budget outlay, to pump as an investment for $62 billion CPEC with an increase of 38.4pc from the outgoing fiscal year’s allocation of Rs 129.85 billion.

The federal budget allocates Rs 30 billion to undertake the efforts to achieve the Sustainable Development Goals (SDGs) which is 0.63pc of total budget outlay, Rs 36.75 billion (0.77pc of total outlay) for water-related projects, Rs 35.66 billion (0.75pc of total budget outlay) for the Higher Education Commission—not exclusively for education—and Rs 48.70 billion (1.02 per cent of the total budget outlay) for the health services at the national level.

More allocations for CPEC instead of SDGs including water, health and education show the government’s intention to put more resources to mega infrastructure project rather than on human resources development in terms of better water, health and education infrastructure.

However, government officials believe that development of roads and electricity under CPEC projects is a guarantee to a broad-based development. This is because the development of roads and electricity minimise post-harvest losses, wastage of perishable agriculture commodities, reduce the cost of delivery to market towns, and convene purchasing power in the hands of farmers who then use it to buy consumer goods, generating a second round of economic activities across the country.

The CPEC will also help in easing the major of job opportunity for youth in all provinces. According to budget documents, the new CPEC schemes include the development of Gwadar, a key factor in the harvests of CPEC. A total of 31 projects as part of the implementation of Gwadar Plan have been resourced in the federal budget 2017-18.

The CPEC is being considered a game-changer by the federal government, that is why it has allocated 4 per cent of the total budget for the new fiscal year while it had already spent until June 2016 Rs 679 million on New Gwadar International Airport, Rs 174814.87 million on communication, Rs 1377.35 million on information technology and telecommunication, Rs 90 million on ports and shipping, Rs 815.091 million on railways and Rs 551.518 million for water and power. The respective allocation for these sectors in the federal budget 2016-17 were Rs 1500 million, Rs 117830 million, Rs 280 million, Rs 6275.621 million, Rs 1887.714 million, and Rs 175 million.

They opine that there would be a higher level of post-CPEC trade and production, which will lead to improved trade facilitation, commercial trade, and transit trade with Afghanistan, Iran, Central Asia and the Middle East.

However, some vital aspects of the CPEC seem overlooked by the policy makers. These include allocation of more development funds for special economic zones (SEZs) which are a major breakthrough in industrial development of the provinces in terms of offering direct employment. The absence of budget allocations for institutions responsible for the development of SEZs and programmes for human capital development would not benefit in the context of creating more jobs in SEZs.

The new projects in budget 2017-18 are included Gwadar airport, a 200-bed hospital, 200 MW power generation, and desalination plant.

The allocations would mostly be spent on the construction of streets and bridges (Rs 160 billion), western route of CPEC (Rs 44 billion), security of the economic corridor (Rs 1.8 billion), Multan-Sukkur section of Lahore to Karachi Motorway (Rs 30 billion), Hakla-Dera Ismail Khan Motorway (Rs 38 billion), construction of Bismah-Khuzdar Road (Rs 1.5 billion), Lahore Abdul Hakeem Section (Rs 54.4 billion), Thakot-Havelian section (Rs 25.2 billion), Burhan Havelian Expressway (Rs 3 billion), construction of Gwadar Airport (Rs 1 billion), Gwadar East Bay Expressway (Rs 1.5 billion), construction of Havelian Dry Port (Rs 10.6 billion) and Matiari Transmission Line (Rs 4.2 billion).

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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