ISLAMABAD: With addition of Rs180 billion in project aid and Rs100bn allocation for public-private partnership (PPP) investments, the total development programme for 2018-19 is being pitched at Rs2.043 trillion and overall federal budgetary outlay at Rs5.7tr.
Last week’s Budget Strategy Paper (BSP) had pegged total outlays at Rs5.237tr.
Prime Minister Shahid Khaqan Abbasi will preside over a meeting of the National Economic Council (NEC) on Tuesday to clear an estimated development programme of Rs2.043tr including a federal Public Sector Development Programme (PSDP) of Rs1.03tr and provincial annual development plans worth Rs1.013tr. The BSP had put the PSDP at Rs800bn.
Provincial chief ministers, prime minister of Azad Kashmir, chief executive of Gilgit-Baltistan and governor Khyber Pakhtunkhwa representing federally-administered tribal areas (Fata) will also attend besides relevant federal cabinet members and secretaries.
Development spending may rise to Rs1.03 tr. No clear revenue plan yet
Before the NEC huddle, Mr Abbasi will visit the Planning Commission for a separate briefing about the annual development programme, Annual Plan 2018-19 (macroeconomic framework) and 12th five-year plan (2018-23). The three items will then be taken up at the NEC for formal approval. The prime minister is also the chairman of the Planning Commission.
The teams of the Finance Ministry, Revenue Division, Planning Division and the Prime Minister Office remained engaged on Monday for finalising proposals and estimates for Federal Budget 2018-19, to be announced on April 27.
Informed sources said there could still be changes to final numbers until after the NEC meeting on Tuesday and make it a tight contest to make up for printing of budget documents before the D-day in less than 72 hours.
An official engaged in these meetings said many allocations being made in next year’s budget were without any backup support, with nobody sure of where these would be delivered from. For example, he said Rs100bn being earmarked for PPP investments for project financing was just an allocation while foreign assistance for development projects was originally estimated at Rs140bn, without any formal commitment from anywhere.
The Annual Plan Coordination Committee (APCC) last week approved Rs750bn for the development budget and requested the prime minister and the NEC to increase it to Rs1.3tr.
He said the budget deficit was being estimated at 5.5pc for current year as the Federal Board of Revenue (FBR) had indicated about a Rs100bn shortfall against the target, but sources in the finance ministry believed the shortfall could be higher and may touch Rs200bn.
Another official said the government was also likely to set aside Rs30bn or so for sustainable development goals and prime minister’s special programme like clean drinking water for all and energy for all given international compulsions. The APCC had not made allocations for these areas.
The NEC will also review Annual Plan 2017-18 and proposed Annual Plan 2018-19, review PSDP 2017-18 and proposed PSDP 2018-19. The meeting will also be presented progress reports Central Development Working Party (CDWP) and Executive Committee of the National Economic Council (Ecnec) from April 1, 2017 to March 31, 2018 and draft 12th Five-Year Plan (2018-23).
Officials said more than Rs600bn were being earmarked for infrastructure, power sector, transport and communications including Rs190bn for those falling in the category of China-Pakistan Economic Corridor projects.
Despite repeated statements by the government ministers saying no new development schemes would be added next year, except a few projects of strategic and undisputed importance, a total of 510 new projects worth Rs825bn are being added to the ongoing list of about 725 projects at different stages of completion. About 65pc next year’s allocation is for ongoing projects.
The NEC will also approve next year’s annual plan envisaging high fiscal and current account deficits – 5.3 pc and 3.8pc of GDP respectively.
Exports are estimated to go up to $27.3bn in fiscal year 2018-19 compared to $24.5bn of current year while imports are targeted to $56.5bn from $53.1bn this year, leaving a trade deficit of $29.2bn next fiscal year against $28.6bn in current year.
Inflation, though slightly picking up, is expected to remain below 6 per cent for the next year and growth rate at 6.2pc with contributions from agriculture (3.8pc), industry (7.6pc) and services (6.5pc).
Four-month budget proposed
Meanwhile, The National Assembly Standing Committee approved a resolution on
Monday, supported by some members of the ruling PML-N, asking the government to present a budget for only four months.
Questioning the rationale of a full-year budget by the outgoing government, Asad Umar of PTI, Rashid Godil of MQM, Dr Nafisa Shah and Syed Mustafa Mehmud of PPP said the right to implement economic policies should rest with the new government.
The resolution was passed with the support of Isphanyar M Bhandara and Qaiser Ahmed Sheikh, both belonging to the PML-N.
“Not only that the incoming government has the right to implement its policies through the budget but there could be different MNAs and financial managers of the PML-N to,” the committee chairman commented.
The committee members also voted against amendments in the ‘Voluntary Declaration of Domestic Assets Bill 2018 and in Foreign Assets (declaration and Repatriation) Bill 2018.’
These amendments relate to the clauses in the amnesty scheme recently launched by the government through the executive order.
As the bills were rejected by the committee, an official of FBR said that the government has the option to get these amendments approved through the finance bill.
Published in Dawn, April 24th, 2018