ISLAMABAD: Amid slowing concessional funding from China, the Planning Commission has asked the government to make available Rs1.3 trillion for the federal Public Sector Development Programme (PSDP) 2018-19 to give a boost to water sector, protect ongoing projects and initiate strategic ventures in Balochistan and western route of the China-Pakistan Economic Corridor (CPEC).

Speaking to journalists on the completion of meetings of the Priorities’ Committee, Secretary Planning Commission Shoaib Siddiqui said the ministry of planning and development had written to the finance ministry that size of the next year PSDP should be enhanced to Rs1.3tr.

The demand, therefore, amounts to almost 30 per cent higher than Rs1.001tr funds allocated for the current fiscal year’s PSDP and 75pc higher than Rs745 billion worth of fiscal space indicated by the Ministry of Finance for FY19.

Responding to a question about Chinese overtures to change mode of financing to future CPEC projects, Siddiqui said there were quarters in China which believed Pakistan had already become the largest recipient of its concessional financing and grants and should be re-looked amid ongoing political transition in Beijing.

He said there were different financing modes from China including concessional financing, buyers’ credit and commercial loans. Siddiqui said he had himself taken up very strongly with the Chinese authorities that CPEC financing mode originally agreed upon should be honoured and they have assured to go by the written commitments.

Responding to another question, he said the government had also activated the diplomatic channels and involved the Economic Affairs Division that was earlier not actively linked with the CPEC to revive its engagements with the Chinese Ministry of Commerce to push through the agreed upon financing mechanism.

He hoped the matters would get smooth on political level after the upcoming tour of Prime Minister Shahid Khaqan Abbasi to China while Minister for Planning and Development, Ahsan Iqbal, would also stay back after Abbasi’s return to follow up with the Chinese side on all outstanding issues.

“After receiving the demands of ministries and divisions, we have realised that majority of the ongoing projects could not be adjusted within the given Rs745bn ceiling.” When asked when the ministries and divisions had utilised less than 50pc of the allocated amount for the current year how the planning division could justify requesting for the increased ceiling, the secretary said it was not his ministry’s job to oversee the utilisation and could only engaged with them for effective project implantation.

For example, he said the National Highway Authority was asking for more than Rs790bn, besides there were some ongoing important projects of the ministries and some strategic projects where work had already began or was about to start which should be protected, he said.

However, he agreed that there was no space for the new projects in the coming PSDP unless a project was of vital strategic or national importance and verified by the principal accounting officer.

He said the priority will be ongoing CPEC projects and those related to western route of the corridor besides giving a fresh focus to the water sector projects.

Responding to a question, he said the meeting of the annual plan coordination committee was tentatively scheduled on April 15 or 16 depending on availability of the federal development minister while tentative dates for the National Economic Council meeting was April 20 in view of federal budget announcement planned for April 27.

When asked about Karachi Circular Railway, he said the agreement in this regard would be signed between Sindh government and China, adding that the federal government had played its part in finalising the project with China and the Sindh government was now required to show some initiative and conclude all details.

Regarding railway Main Line-I project, he said that financial agreement in this regard had already been signed with China and the planning ministry was now waiting for the Ministry of Railways response for the final approval of the project from the concerned forum. He said that ML-I has already been declared a strategic project of Long Term Plan by both China and Pakistan.

Published in Dawn, April 7th, 2018