Rs549.7b for PSDP

ISLAMABAD - The Annual Plan 2008-2009 is silent over the arrangements for the investment to attain the projected 5.5 percent increase in GDP growth, being expected to stay around the last year's level of 21.5 percent of GDP. The budget documents indicate that the Annual Plan is looking forward to the 3.5 percent growth in agriculture, 6.1 percent manufacturing and the services sector each, projecting an investment of Rs 2638.8 billion, around 17 percent of higher than last year whereas the inflation has marked as gray area, which would be sensitivity to the international price movement. The documents point out that the exports are expected to grow by16 percent to $ 22.9 billion whereas the imports would cross 6.5 percent of $ 37.2 billion following the higher volume of import of food items and POL. The trade account is projected to be in deficit of $14.3 billion in 2008-09 whereas the remittance has been projected at $7.7 billion. The manufacturing sector is projected to achieve a growth of 6.1 percent during 2008-09 with the expectations that the energy shortage will subside to a certain extent and export competitiveness improves through appropriate incentives and policy measures. Accordingly, the documents says that large scale manufacturing is targeted to grow by 5.5 percent against the actual growth of 1.8 percent in fiscal 2007-08, with small scale manufacturing growth at 8 percent. The mining and quarrying sector is projected to grow by 5 percent based on 7.6 percent increase in extraction of natural gas, crude oil for 1.9 percent, coal 15.2 percent, limestone 3.5 percent and rock salt 7 percent respectively besides the construction sector expected growth of 8 percent in the fiscal 2008-09 Regarding the services sector, the documents suggest that the services sector would continue to be the main contributor towards the increase in economic growth for fiscal 2008-09. The sector is expected to contribute the growth rate of its sub-sectors, including transport, storage and communication for 4.5 percent, wholesale and retail trade 5.4 percent, finance and insurance 12 percent, ownership of dwellings by 3.5 percent, public administration and defense by 4 percent and social community and personal services by 7 percent. Total required investment is projected at Rs 2638.8 billion in current prices which is about 17 percent higher than the last fiscal. As a ratio to GDP, total investment is expected to stay around last year's level, which is 21 percent of GDP. For financing the required investment, national savings as a ratio to GDP is projected to increase will cater the need of 67 percent of the required investment requirements and remaining 33 percent will be financed through external resources, creating current account deficit of 7.2 percent of GDP. IMRAN ALI KUNDI adds: Government has approved an overall size of Rs 549.7 billions for the Public Sector Development Programme (PSDP) for the year 2008-09, which is equal to 4.5 per cent of the GDP, compared to 4.4 per cent of the GDP in the revised estimates 2007-08.  The PSDP has been raised to Rs 550 billion in the budget for 2008-09, showing an increase of 20 per cent as against the revised estimates 2007-08 at Rs 458.     The share of the federal ministers, divisions in 2008-09 PSDP is Rs 234 billion showing a rise of 19 per cent over the revised estimates 2007-08 as the share was 196 billions last year.  Cabinet Division would get Rs 2.8 billion in years 2008-09, compared to Rs 4 million in the revised estimates 2007-08. Ministry of Shipping and Ports would get 372 millions as it got 1 billion in the last year.  Defense Division would get Rs 4.9 billion, which was Rs 3.2 billion last year 2007-08, while Defense Production Division would get Rs 1.5 billion compared to Rs 505 million of the last year.   The share of Education Division is increased from Rs 4.3 billion to RS 6.2 billion for the year 2008-09. Higher Education Commission has been allocated Rs 18 billion, which was Rs 17 billion last year.  The share of finance division is R s14.7 billion, which was Rs 11.6 last year similarly Revenue Division allocated Rs 2.3 billion, which was Rs 1.5 billion in the last year.    Housing and work division are given RS 50 billion as last year it was 42 billion. Railway division are allocated RS 11 billion which was RS 9 billion in 2007-08   The corporations PSDP 2008-09 has been placed at RS 51 billions indicating an increase of 19 per cent over revised estimates 2007-08, as it was RS 42 billion.  Special Programmes have been allocated a sum of RS 62 billion in PSDP 2008-09, which includes RS 34 billion for income support fund, RS 28 billion for people's works programmes.  Different works programmes are introduced in the budget as for people's works programme-1 Rs 4.4 billion is allocated while for people's works programme-2 Rs 24 billion is given.  Earth rehabilitation and reconstruction authority (ERRA) has been allocated RS 27 billion for budget estimates 2008-09, as last year it was 19 billion.    An amount of Rs 26 billion has been provided in the budget 2008-09 for the development of special areas i.e. AJ&K, N.A and FATA, which is higher by 25 per cent as compared with revised 2007-08 as it was Rs 21 billion.  

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