January 6, 2002	Sunday	Shawwal 21, 1422

KARACHI, Jan 5: Sindh Finance Minister Dr. Hafiz Sheikh said on Saturday the province had now become financially sound and presently it had a surplus of Rs875 million in its coffer.

Talking to a group of newsmen at radio programme, he said when he took over the province was suffering from deficit and its financial matters were being run on drawing overdraft from the State Bank.

The bad financial health of the province, he said, was due to last 10 years mismanagement when expenditure kept rising and revenue collection shrank, resulting in high current account deficit.

As a result of this the province’s credibility with world donors was also badly eroded as its day-to-day financial matters were run on overdraft.

Dr. Hafiz said after paying a liability of Rs11 billion, created by previous governments, from July 1, 2001, no borrowing or overdraft had been made and instead at the moment the province was having a surplus amount of Rs875 million in its exchequer.

He said the financial health of the province, which was the highest revenue earning unit of the federation of Pakistan, had been so weak as less than 4 per cent was being allocated for the annual development programme.

The present government in the budget (2001-02), he said, had allocated 25 per cent of the budget for the annual development programme, which itself was a big achievement.

In the past, he said, a large number of development schemes used to be announced by the successive governments but very few of them were completed. But this government, he said, had completed around 300 development schemes in a short period of 18 months.

Above all, the minister said the present government had introduced agriculture tax and streamlined the taxation system. The property tax system had been improved and updated after 32 years, he added.

Dr. Hafiz disclosed that the Sindh government is going to announce reduction in number of stamp duties from 60 to 30 by next week and efforts are being made to curtail the government’s powers which mostly result in promoting corruption.

In the last budget, he said, no new taxes were imposed by this government and emphasis was on education. Sindh is the first province to introduce free education up to matriculation and has doubled the number of primary schools.

Responding to a question, he said it might be true that no visible progress was being seen, but this government had doubled the education budget other than the salary budget in a single year.

He said there was a good beginning as far as the development and financial matters of the province are concerned as some mega development projects had been taken up — Rs5 billion drinking water project and Keather water supply scheme of 100 mgpd for Karachi.

Similarly, he said several road projects had been taken up and under the Asian Development Bank programme $256 million are being spent on the development of rural roads. President Pervez Musharraf, he said, had approved Northern bypass and Lyari bypass projects for Karachi.

Referring to irrigation water shortage, he said it was a natural problem, but still the province was receiving its water share under ISRA.

Besides differences among the provinces, the distribution of water within the province is also a big problem and needs efficient distribution system through conservation, he added. The irrigation system has to be improved by lining the water courses and a consolidated programme is being taken up with the World Bank.

Dr Hafiz said unemployment was the biggest problem of Sindh and only after over coming this issue “we should expect improvement in law and order”.

The provincial government, he said, was under the process of recruiting 1,500 ASIs and 4000 constables on merits and had already given jobs to 3,000 technicians.

However, he said, without bringing about improvement in the judiciary, things could not improve and people would continue to suffer. He said a huge amount of $300 million was being spent in this sector.

On the health side, he said the government this year allocated Rs450 million for purchase of medicines for the government hospitals against the last year’s allocation of Rs300 million.

The minister said that people should change with the time and realize that the government could no more provide jobs and it was the private sector that had to take a lead in all sphere of life and development works.

He said last year Sindh’s annual development programme was at Rs2 billion and this year it had been enhanced to Rs5.76bn with Rs4bn coming from Khushhal Pakistan and the government-funded right bank development programme of Rs5 to Rs6 billion.

Dr Hafiz expressed the hope that in the coming fiscal Rs17 to 18 billion or at least Rs13 to 13 billion could be allocated for the annual development programme in Sindh.

Despite being the highest revenue generating province, he said, Sindh under the NFC award was getting its share from the divisible pool on population basis. In other countries, Dr. Hafiz said, population was not the criteria and other factors such as revenue collection are also taken in account.