National Assembly Standing Committee on Planning, Development and Reform was told that next development budget 2019-20 under Public Sector Development Programme (PSDP) is likely to remain roundabout same in size as compared to the current development budget. Secretary Planning Zafar Hasan informed this to the committee which met with Junaid Akbar in the chair at here Parliament Lodges on Thursday. The committee discussed development budget making process and upcoming Five-Year Plan.
There is Rs 675 billion budgeted allocation for development under the PSDP in the current fiscal year 2018-19. While briefing the committee, Zafar Hasan said, "It is most possible that size of development budget for next financial year would remain same." He said that 70 percent funds are distributed for ongoing development projects. He said that new projects in order of priority and proposed allocation should be at least 25 percent of the approved case of the projects as per NEC directions. He said that in any case, allocation of the new projects should not be more then 10 percent of the respective ministry's IBC.
During the briefing of the committee on 12th Five-Year Plan-2018-23, the secretary said that average growth rate on the base of agriculture, industry, manufacturing and civil services has been projected at 5.4 percent of Gross Domestic Product (GDP) in the Five-Year Plan. He said that 3.3 percent growth rate of agriculture sector includes 2.5 percent growth of crop sector and 3.7 percent livestock. He said that 5.8 percent growth rate of industry includes 6 percent of manufacturing, 5.8 percent large-scale manufacturing and 4.7 percent commodity producing sector of GDP during next five year. He said that the macroeconomic instability of this magnitude is bound to erode long-term growth prospects and longer the prevalence of this situation, moiré damage could have been inflicted on the economy.
He said that adjustment by definition is growth retarding as the design of the adjustment plan could mitigate negative implication of the painful measures. He said that the focus on the building fundamentals like improving quality of human capital, enabling environment, export potential, resources mobilization, etc, provide guarantee of stability of the growth momentum.
He said that spillover of completed project of China-Pakistan Economic Corridor (CPEC) and establishment of Special Economic Zones will supplement the growth momentum.
The secretary said that the growth strategy of the government is focusing upon building strength of economic fundamentals such as quality and inclusiveness of economic growth or human capital, up-scaling technology capability, sustainable agriculture, social protection, strategic trade policy framework, national SME policy, financial inclusion, productivity and efficiency, and above all an investment strategy for efficient resources allocation.
About the industrial sector, he said that competitiveness, elimination of SROs and Special Economic Zones will attract quality industries.
He said that the economy was confronted with many problems as fiscal deficit touched 6.6 percent of GDP even after parking over 6 percent outside the budget. He said that productivity and efficiency are not comparable even with regional countries. He said that the long-term work force is growing at 3.5 percent, which means the economy need to grow at sustained level of above 7 percent to absorb the new entrants in the job market. He said that the existing high level of indebtedness seriously needs to significantly enhance debt carrying, which could be increased through higher economic growth. He said that 12th Five Years Plan (2018-23) has been prepared by keeping the preferences of the PTI government.
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