Sindh unveils Rs1.04tr deficit budget

| No new tax | Main focus on energy, education, health, employment, security, infrastructure | 15pc raise in salaries

KARACHI - The PPP-led Sindh government on Monday unveiled its fifth budget for 2017-2018 with major focus on energy, education, health, employment, law and order and infrastructure.

The total receipts of the province for financial year 2017-18 are estimated at Rs 1.02 trillion against an estimated expenditure of Rs 1.04 trillion, thus resulting in the deficit of around Rs 20 billion.

Sindh Chief Minister Murad Ali Shah, who also holds the portfolio of finance, presented the budget in the assembly session chaired by Speaker Agha Siraj Durrani.

Shah said in his speech that the budget for financial year 2017-18 reflects a 19.3 percent increase against the budget of 2016-17.

He said education would get the largest chunk of the budget in the upcoming fiscal year. He said nearly 49,000 jobs would be created for the next financial year. Shah also affirmed the government would not be introducing any new tax for the fiscal year.

“For the next financial year, we are proposing an increase of 15 percent in the basic salary of all employees,” he announced.

Receipts estimate reflects an increase of 19.3 percent as compared to that of Rs 854.5 billion for the current financial year. Receipts from the federal government on account of revenue assignment, straight transfer and grants are estimated at Rs 627.3 billion.

Receipts from the federal government are 61.5 percent of the total receipts of the province. Receipts of Federal PSDP are estimated at Rs 27.3 billion. Receipts on account of Foreign Project Assistance (FPA), budgetary support loans and grants are estimated at Rs 42.7 billion. Receipts from the sources of the province, including tax and non-tax receipts, are estimated at Rs 199 billion. The targets of the province’s own sources have been increased by 16.5 percent.

On the expenditure side, the outlay of the budget is estimated at Rs 1.04 trillion as against the budget estimate of Rs 869.11 billion, reflecting an increase of 19.6 percent. The current expenditure, including current revenue expenditure of Rs 666.47 billion and current capital expenditure of Rs 32.64 billion stands at Rs 699.11 billion.

For the next financial year, the current expenditure constitutes 68.2 percent of the total provincial budget, reflecting an increase of 14 percent over the estimate of Rs 572.7 billion for the current financial year.

The development expenditure for the financial year 2017-18 is estimated at Rs 274 billion. This allocation is unprecedented and all-time high. The government is committed to taking Sindh to new heights of progress and prosperity, Shah said.

He said it was the responsibility of a government to create employment opportunities; however, such creation of opportunities should be carefully planned. “During our tenure, we have only made need-based appointments while ensuring meritocracy. For next financial year, we have created around 49,000 posts,” Shah said, adding the major impact is on the already employed, but abandoned, lady health workers. Over 25,000 lady health workers would be incorporated in Sindh. Besides, 10,000 jobs would be created in the police department.

Shah said the people’s government has allocated the highest percentage of resources for education in the year 2017-18. It will see an increase of 24 percent as compared to that the financial year 2016-17.

“For the next financial year, we propose to enhance the education budget from Rs 163.12 billion to Rs 202.2 billion. Grants for universities and education institutions have been estimated at Rs 5 billion,” he maintained.

He said health remains a priority sector and resource allocation for the sector keeps on expanding. For the next financial year, an allocation of Rs 100.32 billion is proposed as against an allocation of Rs 79.88 billion during the current financial year. The ADP of health is pitched at Rs 15.50 billion as compared to allocation of Rs 14 billion for the current financial year. The next financial year will witness an increase of 26 percent in total allocation for the health sector. He said 25,000 new posts would be created at different levels of the health management.

In terms of resource allocation, the share of the home department, including police, jails, rangers and other LEAs, is the second largest. Budgetary allocation for next financial is proposed at Rs 92.91 billion which reflects an increase of 10 percent over the allocation of Rs 84.26 billion during the current financial year. For the next financial year 2017-18, 10,000 new posts of different ranks are proposed for Sindh police.

Murad Ali Shah said the major achievement in the energy sector during the current financial year was that 100MW Sindh Nooriabad Power Company had been established through Public-Private Partnership. “We were able to secure 20 million standard cubic feet gas per day for Sindh Nooriabad Power Company Ltd. Now the plant is fully functional and contributing to mitigate power shortages of Karachi,” he added.

Sindh Transmission & Despatch Company has been established. This is the 1st ever transmission line established by any provincial government. 132KV double circuit from Nooriabad to Karachi has been successfully laid at a cost of Rs 1.95 billion to supply 100MW to K-Electric.

The energy department is in process of finalising Sindh Power Policy which will unfold futuristic plan to cater to the energy needs of Sindh.

He revealed 6,907 villages were electrified within two Discos (Hesco & Sepco) and K-Electric through provincial funding of Rs 8.479 billion. Electrification of 1,170 villages is under progress through provincial funds of Rs 5.994 billion.

The Sindh government has acquired 2.5 percent working interest in six exploration blocks in Sindh under Petroleum (Exploration & Production) Policy-2012 through Sindh Energy Holding Company (SEHCL). These blocks are Armala, Ranipur, Zorgarh, Malir, Shahbandar and Khipro East operated by OGDCL & PPL.

Murad Ali Shah said Sindh has been blessed with huge coal reserves at Thar estimated to be around 175 billion tonnes; one of the largest lignite deposit in the world. Thar Coal resources have an estimated potential of generating 100,000MW of electricity for 300 years.

For the next year, our targets for alternate energy are electrification of 285 primary health facilities situated at Tharparkar, Shaheed Benazirabad, Umerkot, Sanghar, Kashmore and Kambar districts through 352 solar photovoltaic schemes at a cost of Rs 454 million.

The World Bank-funded Rs 13 billion Sindh Renewable Energy Development Project will be launched during the next financial year.

He expressed gratitude to People’s Republic of China for supporting Sindh for Karachi Circular Railway, saying rehabilitation of Karachi Circular Railway has been included in the CPEC with an investment of USD 2.4 billion.

Sindh Sales Tax on travel agents & tour operators has been reduced from 10 percent to 8 percent while SST on services provided by specific class of indenters and call centres has been reduced from 13 percent to 3 percent, besides lowering SST from 8 percent to 3 percent on the services of renting out immovable property.

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