Rs4bn eaten up by law & order: Balochistan seeks funds from centre
By Khaleeq Kiani
ISLAMABAD, Dec 22: Balochistan has sought a capital injection from the federal government -— either through special grants or advanced proceeds of natural resources — as an increase of Rs 4 billion in its federal divisible pool share has been offset by the law and order in the province.
“This year's higher share under the interim NFC (National Finance Commission) has been eaten up by additional expenditure on law and order, reduction in oil and gas production and higher pay and pension bill imposed by the federal government,” a senior member of the Balochistan government told Dawn.
There has been a loss of Rs 1.7 billion in the royalty and gas development surcharge proceeds owing mainly to much lower gas production as a result of law and order problems and supply disruptions. Besides Sui field, Loti and Pirkoh gas fields have faced severe interruptions during the year. A number of additional security posts were built and related infrastructure provided to protect Loti and Pirkoh gas installations.
In addition, so far about Rs 700-800 million have been spent on direct enforcement of law and order, while another Rs 1.6 billion burden came as a result of an increase in salaries and pensions announced by the federal government, the member said.
Both the federal and provincial governments had to incur substantial amounts to maintain law and order in Sui, Loti and Pirkoh areas and their supplies to the national gas grid because many transmission lines came under rocket attacks during the year. He said the federal government might not concede in public but the law and order problems had shattered the confidence of investors.
The member said that the provincial government had conveyed to the centre that the province required additional grants, or other capital receipts in the form of proceeds of land from Gwadar port where a number of federal and provincial agencies were involved in utilising and disposing of land — a provincial resource — to develop port facilities.
He said that Balochistan would retire about Rs 9 billion federal government's cash development loan (CDL) this year, but province’s overdraft would remain more or less at Rs 16 billion — its highest-ever overdraft.
He said the province would get about $135 million (Rs 8.1 billion) from the Asian Development Bank under the Balochistan Devolved Social Sector Programme, but $110 million (Rs 6.5 billion) would be paid to the federal government to retire expensive cash development loans. Another $45 million (Rs 2.7 billion) would be received under the Balochistan Resource Management Programme from the ADB, but again Rs 2.5 billion would be paid to the federal government against CDL, making a total retirement of about Rs 9 billion.
The senior member said the province had taken up the matter with the federal government and the prime minister had recently agreed to consider paying a part of privatisation proceeds of the Pakistan Petroleum Limited to the province whenever the transaction was made.
He said the ADB had projected Balochistan’s overdraft touching Rs 20 billion during the current year but the provincial government was able to contain it in the vicinity of Rs 16 billion through prudent fiscal policies, better management and controlling expenditure.
The provincial government has already sought international aid agencies’ intervention to help avert nutrition crisis among 84,000 internally displaced persons in three districts of the province.
Balochistan has also asked the federal government to reduce the number of federal corporations, utilising more than 33 per cent of the country's total funds, so that the province could get its due share for development. A small Saindak Metals Limited is the only corporation out of total 208 autonomous bodies based in Balochistan.
