The government has earmarked Rs 113.9 billion for subsidies and relief to the common man in 2007-08, which is 5.9 percent higher than the revised target of the outgoing fiscal year. Subsidy on fertilisers has been increased to Rs 13.5 billion in 2007-08 from 12.3 billion in 2006-07, and Rs 7.5 billion has been allocated for subsidy on sugar.
According to budget documents, Wapda will get Rs 52.893 billion as subsidy on GST, agriculture tubewell in Balochistan, and Rs 25 billion on account of inter-Disco tariff differential.
Karachi Electric Supply Corporation (KESC) would get Rs 15.796 billion, on account of tariff differential, Rs 3.35 billion as GST subsidy, Rs 133 million differential agriculture tube-wells in Balochistan and Rs 31.7 billion as payable to PSO and PGCL.
The government has not allocated any amount to the Trading Corporation of Pakistan (TCP) for the import of fertilisers and wheat. However, TCP would be given Rs 1.2 billion on account of reimbursement of losses on cotton operations and Rs 9.5 billion for DAP import. Passco would get Rs 610 million for miscellaneous/export of wheat and Rs 30 million on account of paddy operation. The government has also allocated Rs 15 billion to oil refineries, oil marketing companies (OMCs) and others against revised target of Rs 25 billion for the current fiscal year.
FFC Jordan would get Rs 860 million, Pakistan Dairy Development Company (PDDC), Soprest/GIK Rs 80 million, ghee package Rs 1.2 million, sale of wheat in Fata Rs 110 million, Rs 541 million for sale of wheat, salt and sugar in Gilgit agency, sale of pulses at USC Rs 200 million and sale of Atta at USC 400 million.
The budget documents said that currently the government was not imposing petroleum development levy (PDL) on kerosene, diesel and light diesel oil (LDO).
At present, there is subsidy on kerosene, diesel and LDO as the government has capped the sale price of these products at an affordable level. As a result of the rise in the international crude oil prices, the government is paying price differential claims to OMCs and refineries.
In the past, PDL was a major source of revenue. However, it is on decline now and is being used to pay PDC. The allocation to PDC has been increased by 50 percent as compared to the budget estimates of 2006-07.
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