Development Fund Allocation
LAHORE: The federal and Sindh governments are currently embroiled in a dispute over the allocation of provincial development funds.
The contention centers around the distribution of development funds, with Sindh expressing dissatisfaction despite receiving the highest amount among the provinces.
According to sources, the Ministry of Finance has communicated to the Sindh government that a total of Rs 9 billion 97 crore has been allocated to all provinces for development purposes.
In the current financial year, Sindh has received Rs 5 billion 58 crore, the highest allocation compared to other provinces.
Khyber Pakhtunkhwa has been allocated the smallest amount, with only Rs 39 crore, while Balochistan has received over Rs 3 billion and Punjab has been allocated Rs 90 crore.
Despite this substantial allocation, the Sindh government has raised concerns about the release of these funds. Prime Minister Shehbaz Sharif had instructed the Ministry of Finance and Planning to ensure the timely release of development funds.
However, Sindh Chief Minister Syed Murad Ali Shah subsequently wrote to Prime Minister Sharif, highlighting issues with the non-release of the funds as scheduled.
The Ministry of Finance has assured the Sindh government that the funds will be distributed according to the Annual Development Plan.
Due to lower revenue projections, it has been decided that only 15% of the development funds will be released during the first quarter of the financial year, with the remaining 40% to be released in the last quarter. This staggered release plan has contributed to the Sindh government’s frustration.
It is important to note that the federal government has allocated Rs 78 billion for various development projects in Sindh under the Public Sector Development Programme (PSDP) for the current financial year.
According to the PSDP documents, Rs 1.14 billion has already been released for different projects within the first two months of the financial year.
Specific allocations include Rs 1 billion for the Sindh Coastal Highway project and Rs 1.6 billion for the Stone Pitching Northern Dadu Canal project.
The ongoing disagreements between the federal and provincial governments over the distribution of these funds reflect broader issues of fiscal management and intergovernmental relations.
As both sides work to address these concerns, the effective utilization of development funds remains a critical issue for the economic and infrastructural advancement of the province.
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