The provincial budgets for fiscal year 2013-14 reflect early dividends of devolution. From Karachi to Peshawar, all provincial capitals have made remarkably higher allocations for social sector development. However, that doesn mean infrastructure development has taken a back seat. Quite the opposite!
Reading through the budget documents, one thing is clear: provincial governments are beginning to understand the role of infrastructure development in generating economic activity and employment opportunities. Moreover, there is this realisation now that it is the public-private partnerships that can deliver in governance areas such as urban development and assets management.
Sectoral rebalancing done by the Balochistan government is worth noting. The new government intends to spend more on social sector. It has proposed 89 (new) schemes, mostly in the social sector. These schemes will cost Rs34.5 billion, but the government plans to fund nearly two thirds of that from the FY14 development budget of Rs44 billion.
The fiscal space has been created by reining in infrastructure development schemes at 47 percent of the FY14 development budget compared to 59 percent in FY13. It must be noted that building roads constituted a third of development budget in FY13. But the FY14 infrastructure development portfolio is now a healthy mix of road projects, energy schemes, water schemes, local government development, etc.
Over in the North-West, the Khyber Pakhtunkhwa government has come up with larger allocations not only for social sector development, but also for infrastructure development schemes, indicating a policy to simultaneously address glaring infrastructure gaps in the province.
The provincial government has set aside Rs 15.6 billion for building road networks for less developed areas and also for constructing 521 kilometres of blacktopped roads in major metropolis such as Peshawar, Abbottbad, Haripur and Nowshera. The government has allocated Rs 5.2 billion for urban development schemes, for which Peshawar seems to be major beneficiary so far.
Addressing inter-district disparities also seems high on KP governments agenda. Over Rs 17 billion were allocated for regional development, through projects like Kala Dhaka Area Development, Kohistan Regional Development, Kaghan Development Authority development package, etc. Moreover, there are provisions for potable water, sanitation, street pavement, public parks, etc. for less developed districts.
Flush with funds, the development priorities in Punjab, the countrys agrarian heartland, also seem balanced between social sector and infrastructure schemes. For the next fiscal, Punjab government has set aside an infrastructure development budget of Rs 90.7 billion, with large allocations for schemes in roads, irrigation, energy, public buildings and urban development.
Both new and old, road development schemes, worth Rs 29 billion, cater to all of Punjab - from Murree to Rahim Yar Khan. There is a separate block allocation, worth Rs 4 billion, for farm-to-market roads. Nearly Rs 5 billion are appropriated for public office buildings and housing facilities.
Urban development is concentrated around five large cities of Lahore, Faisalabad, Rawalpindi, Gujranwala, and Multan, where about Rs 14 billion will be spent by using these cities respective development authorities. About Rs 16 billion have been earmarked for regional planning, with projects focusing mostly on the South Punjab and the Pothohar regions.
Not to be left behind, the Southern province of Sindh has also budgeted larger allocations for road networks (Rs16.8 billion), district development programme (Rs20 billion) and rural development (Rs879 million). The budget documents show that the Sindh government is going to construct about 500 km of roads in rural areas with foreign assistance at a cost of Rs 8.8 billion in FY14.
About Rs 11.6 billion have been apportioned to meet the funding needs of large infrastructure schemes related to coal development project in Tharparkar. There are also strong hints of the provincial government reviving the multibillion dollar Karachi Circular Railway project come next fiscal.
Clearly, all four provinces recognise the need for infrastructure development, and have made handsome allocations for the same, in various sectors. However, the public can only derive benefit from such development when the project execution is effective and timely, and its future maintenance is ensured.
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