ISLAMABAD: The government has set the Public Sector Development Programme (PSDP) for the next financial year at Rs650 billion, including foreign assistance of Rs72.5bn, against the backdrop of the challenges emanating from the coronavirus pandemic that enhanced the importance of public investment to trigger job creation, revive economic activity and, at the same time, alleviate poverty.

The PSDP focuses on completion of ongoing projects, adequate rupee cover to foreign-funded projects, providing sufficient funds for initiatives under the China-Pakistan Economic Corridor (CPEC), projects supporting priorities of the economic growth and equity strategy, besides regional balanced development by addressing the needs of less developed areas and promoting initiatives on innovative financing modes to reduce burden on the PSDP.

A special programme to mitigate the impact of Covid-19, with an outlay of Rs70bn, will focus on education, sewerage, solid waste management, clean drinking water and upgrading existing health services. The programme will be executed in collaboration with the provincial and local governments.

To mitigate virus impact, a Rs70bn plan will focus on education, drinking water and health services

Despite devolved sectors of health and population, an amount of Rs20bn has been allocated under the PSDP to overcome the adverse impact of Covid-19 and finance other important initiatives.

Under the PSDP, CPEC projects would carry a likely throw-forward of Rs830bn at the start of the fiscal year 2020-21 which need substantial allocation for timely completion of the projects. About 34 projects under the CPEC at an overall cost of Rs1,625bn are being implemented and these projects are at different stages of implementation.

An amount of Rs179bn has been earmarked in the PSDP to meet the minimum requirements, including CPEC and other priority projects in the transport and communication sector.

According to a PSDP document, the government is keen to take measures to invite private investment and believe in participating in development efforts under the PSDP-plus initiative where more than Rs5 trillion investments are expected. Long-, medium- and short-term projects with sufficient government interventions will be distinctive characteristic of the PSDP.

According to Planning and Development Secretary Zafar Hassan, the PSDP has been prepared under challenging times, addressing key priority areas as well as Covid-19 responsive needs.

Development of less developed areas would continue to receive priority attention, and in the 2020-21 PSDP, special interventions have been made for Balochistan, merged districts of Khyber Pakhtunkhwa and Gilgit-Baltistan. Allocations for projects in Balochistan have not only been enhanced but new schemes have also been included. These are N-50 from Yarik-Zhob, including Zhob bypass, Jhal-Jhao Bela section and Naukandi-Mashkhel, in addition to other road and water projects.

Substantial resources have been allocated for ongoing hydel power projects to harness hydropower potential of Gilgit-Baltistan. In addition to annual development programme of merged districts of KP, a 10-year development plan for these districts with an allocation of Rs24bn will be financed.

An allocation of Rs80bn has been made in the PSDP 2020-21 to finance power sector projects, while Rs70bn has been earmarked for water sector schemes. In the water sector, priority has been assigned to construction of large, medium and small dams to increase water storage, water conservation, rainwater harvesting and integrated water resource management along with generation of electricity. Diamer-Basha, Dasu and Mohmand dam projects are priority of the government.

An amount of Rs14bn has been allocated in the PSDP, including Rs12bn for food and agriculture and food security. The government has recently announced a ‘national agriculture emergency programme’ which intends to uplift the agriculture and livestock sector on modern lines.

The allocation for environment and climate change has been kept at Rs5bn, and the main focus will on the first phase of ‘Ten Billion Tree Tsunami Programme’ formulated to create a clean green Pakistan with improved carbon sinking capacity.

An amount of Rs24bn has been earmarked for special programmes, where main focus will be on SDGs along with other small areas for intervention.

In the transport and communications sector, no provincial road would be taken up, except for the less developed areas of Balochistan, south Punjab, south KP, merged areas and Gilgit-Baltistan. East-west regional connectivity and inter-provincial connectivity have been placed on top priority to improve the linkages aimed at enhancing international trade and trade within the country.

Published in Dawn, June 13th, 2020