Provincial projects: inclusion in PSDP banned

ISLAMABAD: The caretaker federal government has decided to ban inclusion of provincial development projects in Public Sector Development Programme (PSDP) except for least developed districts/regions as determined by Planning Commission, well informed sources in Finance Ministry told Business Recorder.

Finance Ministry has already conveyed to provincial governments that it is going to shelve hundreds of non-starter projects besides making it mandatory for provinces to share in fertiliser subsidy and BISP funding.

The sources said, Apex Committee (AC) of Special Investment Facilitation Council, has directed Ministry of Planning, Development and Special Initiatives to move a summary to National Economic Council (NEC) barring inclusion of provincial projects in federal PSDP.

Jul-Oct 2023-24: Rs300.9bn authorised for projects under PSDP

MPD&SI and caretaker Provincial Chief Ministers have also been apprised that provincial nature projects in Federal PSDP, except for the least developed districts/regions, would be closed/transferred to provinces. A special Working Group led by caretaker Minister PD&SI would firm up implementation modalities, in consultation with provinces. MPD&SI is likely to share its recommendations with the AC of SIFC on Wednesday (Jan 3).

Finance Ministry will submit its report on consultation with the caretaker Chief Ministers on co-financing of subsidy of Rs 80 billion on agriculture tubewells and HEC expenditure of Rs 23 billion.

Secretary Cabinet has been directed to examine inclusion of the following clause in all the summaries for Cabinet, ECNEC and NEC that have financial implications: “it is certified that the expenditure is a valid charge on the Federal Consolidated Fund”.

Secretary M/s PD&SI to examine similar provision for projects presented to Department Development Working Party (DDWP) and Central Development Working Party (CDWP).

State Bank of Pakistan (SBP) informed the AC that it has updated the dividends of majority of the companies that have been repatriated successfully. Foreign Companies continue to report held up profits/ dividends.

The SBP has also issued instruction to implement the enhanced 50 per cent exports proceeds retention limit.

The SBP is to engage with IT companies for information sharing and with the relevant stakeholders in ensuring its implementation through commercial banks. However, Ministry of Information Technology and Telecom will conduct third party survey on the full implementation of the measures.

The sources said the SBP is on board with banks for issuance of debt cards against balances held in Exporters’ Special Foreign Currency Account (ESFCAs) for making foreign payments. Banks need to engage vendors, change systems configuration and conduct successful testing to implement the product offering. The SBP to provide updates in the next EC on the status of banks offering this product.

The central bank will also update the AC regarding engagement with banks to enable digital payment solutions to facilitate IT companies and freelancers.

The sources further stated that Sindh and Balochistan have adopted the First Cloud Policy for the establishment of Cloud Infrastructure. Punjab and KPK to take appropriate measures to adopt the policy soon.

Finance Division to finalize a schedule to return Rs 62 billion of USF (Rs 57.2 billion) and R&D fund (Rs 4.1 billion) in a phased manner. At least 10 per cent will be made available in Q4 of CFY. Balance amount would be budgeted in three successive FYs.

The Executive Committee of National Economic Council (ECNEC) will consider PC-1 for Financing Facility Agreement (FFA) between Ministry of Railways and Government of Sindh on Thar Coal Rail Connectivity Project.

Copyright Business Recorder, 2024