Govt proposes Rs83b for CPEC projects

ISLAMABAD: The government has proposed an allocation of Rs83 billion for the China-Pakistan Economic Corridor (CPEC) projects in the next budget, which appears insufficient due to inclusion of more schemes in the CPEC portfolio that has now ballooned to Rs1.3 trillion.

The Pakistan Tehreek-e-Insaf (PTI) government has decided to include five more CPEC-related projects in the Public Sector Development Programme (PSDP) 2019-20, according to officials of the Ministry of Planning and Development.

It has made first phase of the delayed Mainline-I project of Pakistan Railways part of the PSDP, they added. The total cost of this scheme is estimated at Rs324.6 billion but the government has made an allocation of only Rs1 billion in the next budget, starting July. Gwadar’s water treatment plant project will again remain underfunded in the next fiscal year despite the urgent need to complete the project on priority.

The Rs83-billion allocation is spread over 23 ongoing and unapproved projects initiated under the umbrella of Beijing’s .

The total cost of CPEC projects has increased to Rs1.3 trillion, of which Rs524 billion has already been spent in the past three years. The remaining financing for these projects is estimated at Rs734 billion, according to the Ministry of Planning officials.

“The proposed allocation for CPEC projects is sufficient to meet financing needs in the next fiscal year,” said Hasan Daud, spokesman of the planning ministry.

For the next fiscal year 2019-20, the Pakistan Tehreek-e-Insaf (PTI) government has proposed Rs675 billion for federal development spending. Nearly 19% of the proposed size of the PSDP will be spent in discretionary mode including Rs24 billion on schemes recommended by members of parliament.

In the outgoing fiscal year, the PTI government diverted Rs24-billion CPEC budget to the parliamentarians’ schemes.

The government faces fiscal challenges that have limited its ability to allocate sufficient funds for the ongoing schemes. Despite the scarcity of resources, it has decided to add about 200 more schemes to the PSDP, further thinning out available resources. For the construction of Sukkur-Multan section of CPEC’s eastern route, Rs19 billion has been proposed against the remaining requirement of Rs33.2 billion.

The total cost of the project is Rs298 billion. It appears from the allocation that the project will not be completed by the end of next fiscal year.

For the construction of Hakla-Yarik-Dera Ismail Khan motorway of CPEC’s western route, the Public Sector Development Programme has proposed Rs13 billion for the next fiscal year against Rs25 billion for the outgoing fiscal year. The total cost of this scheme is Rs110.2 billion. The project’s remaining financing requirement is estimated at Rs36.6 billion.

For land acquisition for the Sukkur-Hyderabad section of CPEC, Rs3.5 billion has been proposed for the next fiscal year against the requirement of Rs21.6 billion. For land acquisition for the Islamabad-Raikot section of CPEC, Rs1 billion has been proposed against the remaining need of Rs1.9 billion.

Overall, the government has proposed to massively slash budgetary allocation for the National Highway Authority (NHA) in the next fiscal year. As against the original allocation of Rs310 billion, the NHA will get Rs157 billion, which is in line with the PTI’s decision to move away from the brick and mortar approach.

For the Havelian-Thakot project of CPEC, the government has proposed Rs24-billion allocation against the remaining requirement of nearly Rs31 billion. The total cost of this project is Rs106 billion.

The Zhob-Kuchlak road project, which the government approved in March, will get Rs10-billion financing in the next fiscal year. The total cost of the project is Rs63 billion. Chitral-Bannu road will get Rs1 billion against the total cost of Rs16.8 billion. The preliminary design of Mainline-I would not be completed in the next fiscal year as the government has allocated only Rs1.8 billion for the scheme against the remaining requirement of Rs5.5 billion.

The New Gwadar International Airport has been given Rs700-million allocation against the total need of Rs21 billion. The Eastbay Expressway will get Rs2.7 billion against the remaining need of Rs3.5 billion.

A project initiated to provide five million gallons of clean water per day to the Gwadar city would get only Rs400 million against the remaining requirement of Rs2.9 billion. The total cost of the scheme is Rs3 billion and it has not get full funding in the last three years.

The Gwadar smart environment project has been given Rs100-million allocation against the remaining requirement of Rs2.2 billion.

New schemes

The government has decided to include the Mirpur-Mangla-Muzaffarabad project in the PSDP, costing Rs142 billion. For the next fiscal year, it has proposed only Rs100-million allocation for the unapproved scheme.

It has also decided to conduct a feasibility study for the construction of a 350km-long Nokhandi-Mashkhel-Turbat project of CPEC. The Rs17-billion worth of Shandur-Gilgit road is also part of the new CPEC portfolio. The project remains unapproved and the government has proposed Rs500-million allocation for the next fiscal year.

The government has proposed a Rs29.5-billion project for improving cross-border connectivity between China and Pakistan. For the next fiscal year, the government has proposed Rs2 billion for this scheme.

The fifth new scheme is Mainline-I project of Pakistan Railways. Its first phase will be completed at an estimated cost of Rs324 billion and for the next fiscal year the government has allocated Rs1 billion.


Major allocations budget made for CPEC projects in PSDP

ISLAMABAD: The Public Sector Development Program (PSDP) 2019-2020 presented for next financial year carries substantial amount for carrying out the CPEC related projects, including an amount of Rs55 million for the construction of Gwadar International Airport.

The government has allocated Rs100 million for construction of Project management unit under the CPEC. Rs 2 billion USD has been purposed for the construction of duel highway between Bisma and Khusdar. Besides this, an allocation of Rs2.4 billion has been earmarked for the construction of 118 KM phase-II highway between Hawaliyan to Tahkot.

Another Rs13 billion has been allocated for construction of highway between Burhan Huka to DI Khan. There is also a proposal to construct duel highway between Yak Sagho and Zhob for this Rs 1 billion has been allocated.

There is another in PSDP allocation of Rs 1 billion for re-construction of existing roads between Chitral, Booni, Mastuj and Shandur under the CPEC.

There is also allocation of Rs 3 billion for up gradation of 167 Km highway between Jagoth to Skardu. It was also announced that the government will allocation Rs 3.5 billion for land requisition of motorway between Karachi to Lahore.

There is also provision in of Rs 4 billion the PSDP for M-3 section of motorway between Lahore to Multan. The government has also proposed Rs 250 million to acquire the land for Burhan Juka highway construction.

It has also proposed to distribute Rs 1 billion among the affectees of Hawliyan Tah kot highway that is been build under the CPEC.

In PSDP the government has earmarked Rs 19 billion for Peshawar to Karachi for 392 km motorway project. There is allocation of Rs 500 million for construction of Gilgit, Shandur Chitral road.

The PSDP also carried allocation of Rs 100 million for construction of road between Mirpur, Mangla, Muzaffarabad.