ISLAMABAD: A mere two months into the fiscal year, the government slashed the Public Sector Development Programme (PSDP) 2024-25 allocation for the National Highways Authority (NHA) from Rs 180.284 billion to Rs 161.264 billion i.e. by around 12 percent, fearing to hamper/delay projects execution and cost escalation.

Sources revealed that the allocation for ongoing schemes was slashed from Rs 167.8 billion to Rs 149.280 billion, whereas, for new schemes it was slashed from Rs 12.484 billion to Rs 11.984 billion.

The government has allocated only Rs 50 million for the construction of Hyderabad-Sukkur (306km), 6-Lane divided, fenced Motorway on Build Operate Transfer (BOT) basis.

Rs180.284bn allocated for 104 projects under PSDP

The cost of this crucial stretch for the completion of the Peshawar-Karachi Motorway (PKM) which is yet to come into implementation has increased by around 33 percent from the initial estimates of Rs 308 billion to more than Rs 410 billion. The government had earlier allocated Rs180.284 billion for 104 projects under the PSDP 2024-25 for NHA, which was around 16 percent higher than Rs156 billion allocated for the fiscal year of 2023-24.

Official sources revealed to Business Recorder the government had initially communicated provisional Indicative Budget Ceilings (IBC) of Rs 92 billion under PSDP 2024-25 to NHA for carrying out ongoing and new projects. However, NHA demanded Rs 628 billion against around 100 ongoing and new projects.

The Annual Plan Coordination Committee (APCC) proposed Rs 180.284 billion for 104 projects under PSDP 2024-25 for NHA to the National Economic Council (NEC). For 90 ongoing projects, Rs 167.800 billion were proposed, whereas, Rs 12.484 billion for 14 new projects.

The NHA was expecting to get around Rs 200 billion under the PSDP 2024-25, however, the APCC proposed Rs 180.284 billion.

With the latest cut in PSDP 2024-25, the throw-forward of NHA is expected to further increase which is already accumulated to Rs 2.226 trillion, as a result of inadequate budgetary allocations contrary to the actual demands.

Federal Minister for Communications Aleem Khan last week informed the National Assembly Standing Committee on Communications that lower allocation is resulting in accumulating huge backlog in the shape of throw forward and piling up of loans for the organisation.

He also warned that the funds allocated for the sector is less due to which the projects cannot be completed on time, resulting in loss to the country.

Copyright Business Recorder, 2024