June 23, 2007	Saturday	Jamadi-us-Sani 07, 1428

ISLAMABAD, June 22: The centre has recovered about Rs40.2 billion cash development and foreign loans from provinces during the outgoing fiscal year, about 150 per cent higher than Rs16 billion target set in the budget 2006-07, official data suggests.

The documents of the federal budget for the year 2007-08 —passed by the National Assembly on Friday — suggest that all the four provinces repaid much more than their original targets. They together paid Rs32.4 billion cash development loans to the centre which was almost four times higher than the original budget estimate of Rs8.7 billion.

During the next year, the centre has projected to recover a total of Rs14.6 billion loans from the provinces, including Rs6.65 billion cash development loans.

Budget details reveal that the centre recovered about Rs9.6 billion from Punjab on account of cash development loans during the outgoing financial year against budget estimates of Rs3.95 billion, up by 142 per cent.

Sindh also repaid Rs9.3 billion as CDL against budget estimates of Rs1.99 billion, showing an increase of more than 367 per cent.

The NWFP that was originally projected to repay Rs1.6 billion to the centre as CDL in effect retired Rs6.5 billion during the current year, showing an increase of more than 306 per cent. Balochistan, too, had to repay Rs7 billion in CDLs against its original target of Rs1.3 billion, higher by about 494 per cent.

Moreover, the centre also recovered Rs7.8 billion from the four provinces on account of foreign loans against budgeted estimates of Rs7.3 billion, showing an increase of about 6.9 per cent.

In addition to the provinces, the federal government also recovered over Rs26 billion against Rs18.3 billion budget estimates (42 per cent higher) as cash development loans and other advances from the public sector organisations, like Wapda, National Highway Authority, Capital Development Authority, Radio Pakistan, Sui Gas companies, Shaukat Khanum Memorial Trust and regulatory authorities.

As such, the federal government recovered a total of Rs66.2 billion from the provinces and other public sector entities against budget estimates of Rs34.3 billion, showing a higher collection of about 93 per cent over original estimates.

The recovery target for the next year as loans and advances has been put at Rs41 billion.

The higher recovery has been made possible under a policy decision that allowed borrowers to replace expensive government debts with foreign-funded programmes. As a result, the provinces and public sector units made some early repayments.

The four provinces together owed Rs190 billion foreign loans and about Rs145 billion cash development loans until last year. Every year, the provinces have to take fresh CDLs to service the existing CDLs.

Sindh’s liability for payment of CDL amounts to Rs28 billion while foreign loan burden has increased to Rs71 billion. Punjab carries a total debt burden of Rs143 billion that includes Rs73.61 billion CDLs and Rs69.78 billion foreign loans.

The NWFP shows Rs22.26 billion CDL liabilities and more than Rs49 billion foreign loans. Balochistan carries more than Rs51 billion loans.