ISLAMABAD, Jan 08 (INP): President, Islamabad Chamber of Commerce & Industry (ICCI) Ahmed Hassan Moughal has expressed grave concerns over the drastic cut in the development budget as the government has sanctioned only 225.4 billion rupees for development projects for the first half of current fiscal year, which is reportedly 32% lower as compared with the disbursements made in the first half of previous fiscal year.
In a statement issued here on Tuesday, Ahmed Hassan Moughal said that the significant cut in the budget for development projects is not a good sign for the private sector as it would reduce demand for manufacturing goods, further hurt the business activities and slowdown the economic growth of the country.
He said that the Federal Public Sector Development Program (PSDP) played important role in the growth of indigenous industry as increase in PSDP created more demand for indigenous products. However, the downward revision of PSDP budget in the first mini-budget and hefty cut in the sanctioned budget for development projects in the first half of current year would further hurt the domestic industry and affect its growth.
The ICCI President said that the current government has set targets to build 5 million houses for low income people and create 10 million jobs, but its measures to slash budget for development projects would thwart its efforts to achieve these targets and uplift the living standards of people. He stressed that instead of slashing budget for development projects, government should increase it by cutting other expenses in order to stimulate the economic growth of the country.
Senior Vice President ICCI, Rafat Farid said that budget strategy allowed the ministries to spend 40% of their annual development budgets in the first half of a fiscal year, which meant that the development spending should have been Rs.270 billion instead of Rs.225.4 billion during this period. However, the release of almost Rs.45 billion less budget in the first half of current year would have negative impact on the industrial and economic growth of the country. He urged that the government should focus on cutting all non-developmental expenditures and improve allocation for development projects that would help in economic revival of the country.
Vice President ICCI Iftikhar Anwar Sethi said that the PTI after coming into power had introduced austerity measures, which was laudable. However, he stressed that austerity campaign should not affect development projects as subjecting development program to austerity measures would not help the government to put Pakistan on the path of sustainable economic growth.