ISLAMABAD, May 31: The National Economic Council (NEC) on Wednesday set seven per cent economic growth rate target and an estimated Rs435 billion development expenditure for the next financial year.
On a traditional basis, the size of the Public Sector Development Programme was approved at Rs385 billion, including Rs270 billion for federal programme and Rs115 billion for provincially self-financed projects.
However, the gross PSDP size was jacked up to Rs435 by including Rs50 billion for earthquake rehabilitation, instead of placing it in the non-development budget. The Rs270 billion federal programme would have “an operational shortfall of Rs20 billion”, said Dr Akram Sheikh, deputy chairman of the planning commission, after the NEC meeting.
Thus, the next year’s PSDP would be Rs365 billion compared with current year’s Rs272 billion, showing an increase of over 34 per cent. In addition to this, Rs180 billion would be invested from their own resources by public sector corporations, including those having government’s majority shareholding like the PTCL, he said.
Briefing journalists along with secretary for planning Akram Malik, the planning commission deputy chairman said the development strategy for the next year would be food security, energy security and water security, enabling environment for investment and human resource and skill development by taking advantage of Pakistan’s strategic geo-political situation.
He said the challenges would be to sustain the development and growth momentum, stabilise prices, generate employments and remove mismatch between skills and growing needs of a knowledge-based economy.
He said the infrastructure sector would be provided highest share of Rs132.5 billion (49.1 per cent) in the federal PSDP, followed by Rs130.8 billion (48.4 per cent) for social sectors and Rs6.7 billion (2.5 peer cent) for other sectors.
Dr Sheikh said water security had been given top priority and allocation for the sector had been increased by 32 per cent to ensure completion of projects on schedule such as raising the Mangla dam, Kachhi, greater Thal and Rainee canals, lining of irrigation channels and the National Drainage Programme.
Moreover, Rs10 billion had been allocated for land acquisition for five mega dams, including the Kalabagh dam, as announced by the president, he said.
He said adequate funds had been included in the PSDP for providing air and rail links of Gwadar with up-country, Iran and with corridors leading towards Central Asian states to leverage Pakistan’s strategic location. Intensive work on the National Trade Corridor would also be initiated during 2006-07 to facilitate trade flows and help reduce the cost of doing business.
He said the NEC had directed relevant authorities, including the planning commission, to further improve implementation of development projects within approved cost and on time so that objectives could be achieved.
Dr Sheikh said the size of the Khushal Pakistan Fund established in 2005-06 with Rs5 billion had been increased to Rs10 billion. This will be in addition to Rs24.4 billion allocation for the Khushal Pakistan Programme I & II.
He said the next year’s growth target had been set at seven per cent against current year’s provisional estimates of 6.6 per cent. This will be achieved through a 4.5 per cent growth in agriculture, 10.9 per cent in industry, including 13 per cent large-scale manufacturing, and about 7.1 per cent of services sector growth.
He said the GNP per capita income would increase to $935 next year compared with current year’s $847. A total of 1,885 projects are part of the next year’s PSDP against current year’s 1,512 projects, of which 302 projects have been completed during the year.
He said the total expenditure during the first 10 months (July-April) of the current year under the PSDP stood at Rs149 billion or 73 per cent of the Rs204 billion federal programme and by the end of the year Rs194 billion or 95 per cent would be utilised.
