ISLAMABAD: Federal Minister for Planning, Development and Special Initiatives Ahsan Iqbal said that due to the worst economic situation, the government would have to further cut the Public Sector Development Programme (PSDP) 2024-25 if it did not impose more taxes on the people.
The minister expressed these views while responding to supplementary questions of the members in the National Assembly on Friday.
He said that before 2018, there was only 15 per cent share of provinces in federal PSDP but from 2018 to 2023 it reached 40 per cent. He said that most of the resources had been transferred to the provinces under the 18th amendment and the 7th National Finance Commission Award in 2010. He said that the primary responsibility for local socio-economic development lies with the provincial governments.
Ahsan fears Rs200bn-400bn cut in PSDP outlay
He said that federal government would rationalise the PSDP and would focus on the development projects relating to hydel power, infrastructure under the National Highways Authority (NHA) and big dams.
The minister said that the federal government in the previous year had allocated Rs130 billion for Balochistan under the prime minister’s direction which is more than other provinces.
He said that increasing the budget allocation would require imposing additional taxes which the public cannot bear at this time. He said that consequently, the development budget has already been reduced from Rs1,400 billion to Rs1,100 billion and further reductions are now likely. He said that most of the development budget depends upon the loans.
He said a package for the urban areas of Sindh has also been included in the PSDP which will be finalised with consultations of the elected representatives from the province. He said an alternative motorway between Karachi and Hyderabad will also be constructed.
The minister said that most of the tax revenue goes to repaying of debt servicing. He said that the government’s priority will be to continue projects funded by external sources, completing CPEC projects using the development budget, and focus on other national interest projects.
In written reply to a question, the Minister said that over last 10 years, the CPEC has achieved numerous milestones with completion of 37 projects at cost of $25 billion.
He said that completed projects included 16 projects in energy sector at cost of $ 16 billion, seven projects in infrastructure sector, whereas, other completed projects are related to Gwadar port and socioeconomic development.
He said that currently, 21 projects are under development in various sectors across the country which are at various stages of negotiation with Chinese side and are expected to be developed under the framework of CPEC.
The minister said that at present, 11 CPEC projects at cost of Rs276 billion are under construction which are being funded or partially funded through PSDP including; seven projects in Balochistan, one each in Punjab, Sindh and Khyber-Pakhtunkhwa.
Copyright Business Recorder, 2024