ISLAMABAD (April 01 2009): Pakistan is expecting Rs 678 billion spending on war against terror during the current financial year ie 2008-09 with 40 percent increase as compared to 2007-08. Sources told Business Recorder that Pakistan spending pertaining to war on terror stood at Rs 484 billion during 2007-08.
Due to surge in activities of Taliban in North West Frontier Province (NWFP), Pakistan may face 40 percent increase in spending on war against terror during the current financial year. Sources said that due to huge spending on war against terror, the development projects in different sectors were being curtailed that may result in slowdown of economic growth in the country.
Due to issuance of travel advisories by different countries followed by poor law and order situation as a result of war against terror, Pakistan is also facing problems in attracting foreign investment, sources said. Sources said that it was one of the reasons that forced the government to effect cut in development projects.
Due to financial constraints, the Finance Ministry has already conveyed to other ministries that it would cut 35 percent funds for ongoing projects during the second half of the current financial year. The concerned ministries have been directed to identify the projects for the purpose of reduction in funds release. The projects near completion will not face reduction in funds.
The government released only Rs 71 billion for development projects during the first half (July-December) of the current financial year that is 19 percent of total Public Sector Development Programme (PSDP) allocation amounting to Rs 371 billion. The government had released Rs 132.6 billion in the corresponding period of the last financial year ie 2007-08, Rs 99.1 billion in 2006-07 and Rs 68.3 billion in 2005-06. The government is now focusing on the projects that could generate economic growth leading to reduction in poverty, enhancing income generation and increasing productivity to maximise returns.
After the monitoring, the Planning Commission has assessed that 325 projects would face delay in implementation for more than one year that include 82 projects in infrastructure, 173 projects in social sector and 70 projects in other sectors. As many as 102 projects would face one-year delay including 5 projects in infrastructure, 34 in social sector and 63 projects in other sectors. As many as 42 projects are at the initial stage. As many as 73 projects are facing delay due to problems in funds release.
