ISLAMABAD- The government has trimmed Public Sector Development Programme (PSDP) by Rs 102 billion or 18.82 per cent of the annual budget of Rs 541 billion, which the authorities term a desperate move to curtail widening gap between the income and expenditure.   Reliable sources in Planning Commission told TheNation the after two-day long deliberations with the concerned ministries and departments, the Commission concluded to slash public sector development spending by at least 18.82 per cent over the annual outlay of Rs 541 billion. "The government temporarily reduced the development spending of all the ministries excluding the health and education in the range of 15 to 30 per cent and would again review the situation after three months," the sources said. However, three to four ministries, Communication, Food and Agriculture, Science and Technology would further work out their plans, which may slightly change the position of final reduction in the PSDP, they added.    The government had allocated Rs 541 billion for Public Sector Development Programme 2008-09. It gave Rs 371 billion for federally financed projects and Rs 170 billion for Provinces' Annual Development Plan 2008-09. The reduction will only be applied on the federal portion, which in real terms would come down to Rs 269 billion or 27.5 per cent less than the earlier amount. Pakistan is passing through one of the worst times of its economic and financial crisis. The country is facing financial problems both at internal and external fronts. Domestically, the government is striving to keep budget deficit, gap between income and expenditure, at 4.7 per cent of the GDP. The international financial institutions like of the World Bank and the International Monetary Fund (IMF) are also squeezing the government to rationalise the expenditure and keep the budget deficit at 4.7 per cent of GDP by all means.   The government's total receipts, both tax and non-tax, are estimated at Rs 1679.2 billion. Out of which it will transfer Rs 568.3 billion to four provinces as their share in the federal pool. If all goes as planned, it will have Rs 1110 billion in net, which is less than its annual current expenditure of Rs 1493.2 billion. The government borrows whatever it needs to finance development schemes all over the country. On external front, high import bill is fast eating up foreign exchange reserves, which have come down to $ 9.36 billion form the highest mark of $ 16.4 billion in October last. The sources said the Planning Commission has worked out to initially cut Communication Division budget by over 27 per cent of its total development budget, Railways Division 29 per cent, Finance Division 30 per cent, Agriculture initially Rs three billion but further reassessment of the projects will be carried out. The Defence Division development spending has been slashed by ten per cent and the concerned officials told to be prepared for additional 10 per cent cut, the sources added. The Interior Division budget was reduced by 15 per cent and Industries 30 per cent. The government has also asked the ministries and departments to figure out those projects, which could be transferred to Infrastructure Project Development Facility on Public-Private Partnership mode, the sources added. Deputy Chairman Planning Commission said funds for income support for the poor (Benazir Card Scheme) will not only be fully protected but may be enhanced. The meeting decided that flow of funds to priority projects would be resumed in an orderly manner so that the development effort is not impaired. A PC statement said that in consultations with the Ministry of Finance and the concerned Ministry, the Planning Commission would authorise funds for projects in the first week of each quarter. "The PSDP will be judiciously spent according to clear priorities determined by the elected government and the amount may be adjusted in response to economic circumstances. Priority projects will, however, be fully protected," said the PC statement. Infrastructure Project Development Facility head, Ghulam Murtaza Satti, a former PPP MNA, said the government cut only that money, which was being spent for lavish purposes. "The projects that are critical for development would be transferred to Public-Private Partnership mode, as we have investors in queue to finance such projects," he added.