ISLAMABAD, Feb 6: The government has decided to rationalise this year’s development programme by restricting the release of funds for projects that are yet to take off to meet the rising fiscal gap and the provinces have been asked to follow suit.

“There is no formal cut in the PSDP (Public Sector Development Programme) but the projects that have not yet been started ‘despite allocations’ would not be provided funds this year,” Mohammad Asif Sheikh, Planning Commission’s spokesman told reporters on Wednesday after a meeting of the Executive Committee of the National Economic Council (Ecnec) that approved 32 development projects of Rs317 billion.

He said the overall utilisation of funds under the PSDP has been much better than last year, but releases in the third and fourth quarters of the year would be made on the basis of the success rate in the first half of the year.

He said there would be no formal cut, the programme would be rationalised. This would mean that projects that need more funding would be provided additional funds while slow-moving projects would not get funds to ensure that the money, that was limited, did not remain parked unutilised.

Similarly, he said, the projects that had not taken off would not be started this year. He, however, declined to say how many development projects could not be initiated even after the lapse of seven months of the fiscal year. He said the provinces had also been asked to rationalise their public sector programmes and see how much money they could spare but no figure had been indicated to them.

Planning secretary Ghiasuddin Ahmed said the meeting approved 32 projects of Rs317.3 billion, including a foreign exchange component of Rs139.4 billion. These include 23 new projects of Rs309 billion and nine ongoing projects whose cost had been increased to Rs8.2 billion from the original Rs6.2 billion.

Of the 32 projects, 15 projects worth Rs132.2 billion were approved in the infrastructure sector and another 15 in the social sectors at a cost of Rs183.3 billion.

Of the 15 infrastructure projects, Mr Ahmed said, eight were of transport and communication, one in water sector, four in energy and two in planning and housing.

In the energy sector, Rs20 billion power transmission enhancement project was approved for Wapda’s transmission system, while another Rs22 billion project was approved for construction of a 450-500MW combined cycle power plant at Nandipur. Another Rs2.4 billion project was approved for a uranium mining project in Dera Ghazi Khan.