SIFC decision: Centre to finance provinces’ key projects by sharing costs

ISLAMABAD: The Special Investment Facilitation Council (SIFC) has taken the principled decision that the federal government will only finance extremely important provincial development projects with 50:50 per cent funds allocation by the Centre and the provinces. 

On the other hand, the Ministry of Planning has identified all those provincial nature projects that exist in the list of Public Sector Development Programmes (PSDP) to be presented before the Cabinet Committee on Economic Revival (CCER) in order to abolish all such schemes to save Rs314 billion under the austerity drive.

Minister for Finance Dr Shamshad Akhtar will chair the CCER meeting after her return from abroad. “The exercise to abandon the provincial nature projects from PSDP list is underway,” said a top government official when The News contacted him on Thursday.

It was decided in the last SIFC’s Apex Committee meeting that development projects of provincial nature would only be executed in the future through the cost-sharing of 50:50 per cent of funds borne by both the Centre and provinces. “If the provincial government does not bear 50 per cent cost on an equal basis, the Centre will not provide its share of funding,” another top official source confirmed while talking to The News.

One senior official said the decision had already been taken up by the Executive Committee of the National Economic Council (ECNEC). The SIFC’s Executive Committee is scheduled to meet early next week to undertake all spadework for tabling it before the Apex Committee under the Chairmanship of Prime Minister Anwar-ul-Haq Kakar in the coming weeks.

So far, the SIFC has remained unable to finalize much-awaited multi-billion dollar transactions for attracting investments but it is making all-out efforts to lure foreign investors in areas of mining, IT, agriculture, and others.

One of the future SIFC agendas for considering mechanisms for corporate farming lies on the table. Although some initial work was done during the tenure of late Gen (retd) Musharraf, still there is a need to undertake its basic framework in a detailed manner before striking pacts with international investors. However, it is critical to hire technical experts for drafting international agreements and steering the negotiations against the backdrop of several past agreements ending up in disputes due to a lack of technical capacity.

Meanwhile, different ministries/divisions have been directed to undertake steps under the austerity plans to ensure savings. The Ministry of Finance instructed all its wings and attached departments to review all the foreign visits and banned all those deemed necessary next week.