Ahsan Iqbal, chaired a meeting of the Prime Minister’s Committee for Planning and Execution of Foreign-Funded Development Projects in Islamabad

Islamabad 24th October 2024:* Federal Minister for Planning, Development & Special Initiatives, Ahsan Iqbal, chaired a meeting of the Prime Minister’s Committee for Planning and Execution of Foreign-Funded Development Projects in Islamabad on Thursday. Attendees included Secretary Planning Awaise Manzur Sumra, Secretary Economic Affairs Division (EAD), Member Infrastructure, Waqas Anwar and senior officials from the Ministry of Planning. Federal Minister for EAD Ahad Cheema participated via video link.

The committee discussed in detail the planning and execution of foreign-funded projects and the need to refine policy guidelines in line with the Economic Coordination Committee’s (ECC) decisions.

During the briefing, it was highlighted that the challenges posed by scarce resources and huge demand for development projects needs to be address during the financial year. The Ministries demanded PKR 2,900 billion whereas approved development budget was PKR 1,100 billion. The PSDP currently stands at PKR 1,100 billion, with an allocation of PKR 220 billion in foreign funding as rupee cover. The financial constraints have led to a 10 times increase in the throw-forward, alongside administrative and implementation challenges.

He highlighted that over the past years the pie of development portfolio is squeezing contrary to increasing demand for development infrastructure. Moreover, adjustment of fiscal targets the development budget is shrinking.

Minister Ahsan Iqbal stressed the importance of preparing plans that address the minimum essential requirements of ministries to ensure timely disbursement of funds. He emphasized that all projects should demonstrate robust economic and financial rationale, given the current balance of payments challenges. He also called for the establishment of a mechanism to reduce financial burdens and ensure practical implementation.

Minister Iqbal further added that all PSDP projects, including foreign-funded initiatives, need execution within the specified timelines and clear ownership to avoid cost and time overruns. He stressed the importance of carefully managing economic and financial risks associated with foreign-funded projects, as exchange rate fluctuations can significantly impact loan repayments, increasing the burden on government finances.

In his concluding remarks, Minister Ahsan Iqbal directed the EAD to come up with a realistic demand of budget in consultation with respective Ministries/Divisions which will be deliberated with ministry of Finance to arrange required funds for development projects.