Rs1.363tr allocated for subsidies

ISLAMABAD   -   The federal government has allocated Rs1.363 trillion for the subsidies for the next fiscal year to protect the people from the highest ever inflation rate in the country.

The federal government has reduced the amount for subsidies by 27 percent to Rs1.363 trillion in the budget for next fiscal year from revised Rs1.071 trillion of the outgoing financial year.

The major portion of the subsidies would be given to the power sector. The government has allocated Rs1.190 trillion to WAPDA/PEPCO for FY 2024-25 as compared to revised Rs584 billion of the outgoing year.

In the power sector, the government has earmarked Rs509 billion as lump provision for subsidy, Rs276 billion as subsidies for inter-DISCO tariff differential, Rs65 billion subsidies for merged district of KP erstwhile FATA, Rs108 billion as subsidies for tariff differential to AJK, Rs48 billion for Pakistan Energy Revolving Fund, Rs174 billion for K-Electric for tariff differential, Rs88 billion as TDS KE arrears, Rs86 billion for TAFA subsidies arrears and Rs120 billion for additional subsidy.

The government has reduced the subsidy amount for petroleum to Rs18.4 billion for the year 2024-25 from revised Rs50.6 billion of the ongoing fiscal year. The breakup showed that it has earmarked Rs2.4 billion for the shortfall in guarantees through PEPCO, Rs6 billion for payment of the shortfall of ASIA petroleum and Rs10 billion for domestic consumers through SNGPL.   

Meanwhile, the government has enhanced the subsidy amount to Rs12 billion for Pakistan Agricultural Storage and Services Corporation (PASSCO) for next fiscal year as compared to revised Rs10 billion of the outgoing year. The breakup showed that Rs8 billion has been allocated for wheat reserve stock and Rs4 billion on account of cost differential of sale of wheat.

The government has allocated Rs68 billion for the ministry of industries and production. It has kept Rs3 billion for production and supply of urea fertilizer, Rs65 billion for the Utility Stores Corporation (USC) from Rs35 billion. Meanwhile, the government has earmarked Rs10 billion for Ramazan package, Rs50 billion as USC PM package arrears and Rs5 billion as USC sugar subsidy arrears.

It has allocated Rs75 billion for other sectors. The government has earmarked Rs15.872 billion for wheat subsidy for Gilgit Baltistan (GB), Rs10 billion for import of urea fertilizer, Rs1 billion for Naya Pakistan Housing Authority, Rs21 billion for Mera Pakistan Mera Ghar Scheme, Rs5 billion for mark-up subsidy and risk sharing scheme for farm mechanization/Kissan package, Rs3.2 billion for refinance and credit guarantee scheme, Rs2 billion for enhancing financing to SME sector, Rs13.86 billion to support phasing out of SBP refinancing facilities and Rs3 billion for Metro Bus.