Rs164.45bn budget for Balochistan -Pakistan Press Foundation (PPF)

Paksitan Press Foundtion

Rs164.45bn budget for Balochistan

By Nasir Jamal and Saleem Shahid

QUETTA: The Balochistan government unveiled on Tuesday a Rs164.45 billion budget for the next financial year, with a development programme of Rs31.24 billion and deficit of Rs6.73 billion.

Finance Minister Mir Asim Kurd presented the budget in the provincial assembly with the consolidated revenue and capital receipts estimated at Rs157.84 billion.

The revenue receipts of Rs127bn consist of federal transfers of Rs93.255bn from the divisible pool, Rs13.41bn as straight transfers and Rs3.54bn as its share from provincial GST on services and Rs12bn as well-head price and gas development surcharge (GDS) arrears.

The provincial tax and non-tax contribution to the total receipts have been estimated at Rs4.85bn.

The capital receipts comprise floating debt of Rs12.1bn, income of Rs9.98bn from state trading, federal contribution of Rs4.37bn for the repayment of the blocked State Bank loan and recovery of loans and advances of Rs2.18bn.

Additionally, the provincial government hopes to receive foreign assistance and loans of Rs2.15bn for development projects and a Japanese grant of Rs0.016bn.

Total non-development spending has been estimated at Rs133.21bn — revenue expenditure, including salaries, of Rs90.56bn and capital expenditure (loan repayments and investments) of Rs42.64bn.

Major capital expenditure includes Rs20.62bn for repayment of public debt, central loans and the blocked State Bank loan and Rs9.93bn for state trading in wheat, etc. Besides, a sum of Rs12bn has been set aside for investment in the Reko Diq copper refinery plant (Rs8.5bn) and alternative energy projects (Rs3.5bn).

Major initiatives announced in the budget include creation of 6,270 jobs and posts “to reduce unemployment in Balochistan and improve effectiveness and efficiency of government departments”, establishment of the Reko Diq copper refinery, upgradation of posts of school teachers, 15 per cent increase in salary of government employees and 15-20 per cent enhancement in pensions in line with a federal decision.

The perks of provincial employees have also been enhanced to help them cope with rising cost of living.

Other important initiatives focus on enhancing health and education facilities, construction of road network, development of mineral resources and irrigation system, provision of clean drinking water to people and establishment of new industrial estates for attracting domestic and foreign investment.

The finance minister said the government had entered the current fiscal year with an estimated deficit of over Rs7bn.

“But we took effective measures to cut our budgeted non-development revenue expenditure by more than Rs9bn to increase the provincial contribution to development spending to Rs25.58bn from the budgeted Rs22bn and create a surplus of Rs790m at the end of the year.”

Total savings during the year are estimated to be above Rs12.5bn. The development spending for the outgoing year is estimated to reach Rs34.66bn from the budgeted Rs26.75bn. This includes federal contribution of Rs6.79bn (outside the federal PSDP) and foreign assistance loans of Rs1.48bn.

Mir Asim Kurd claimed that the provincial economy had improved considerably during the year because of initiatives to reduce unemployment, increase budgetary allocations for social sector and economic infrastructure. “But it does not mean that we have addressed all the challenges.”

He said the government was pursuing a policy of self-reliance and reducing the debt burden on the province and the future generation. Balochistan is the first province in the country to have retired its federal cash development loans (CDL) and hopes to completely pay off the remainder of the State Bank loan by 2012-13.

He said the government had completed 109 ongoing and 314 new development schemes in the road, irrigation, health, education, water supply and power sectors during the current year.

In order to increase province’s own revenues, the government has constituted an advisory committee to recommend actions for improving provincial taxes.

He said the province had already taken steps to improve the collection of tax and non-tax revenues and was hopeful of meeting the target for the current year.

The government has neither imposed any new tax nor revised the rates of the existing taxes.

The minister said the government had lent Rs1.86bn to the food department for procuring wheat this year. This had helped prevent further addition to the province’s debt burden. He said the government was pursuing a policy of fiscal discipline in order to create greater financial resources for development.
Source: Dawn
Date:6/22/2011