ECC restores Rs7b for MPs' schemes

Okays Rs10.2b for submarines, Rs693m for peace talks, clears Rs100b loan guarantee

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PHOTO: FILE

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ISLAMABAD:

The government on Friday approved over Rs10 billion in additional budget for the development of submarines and also sanctioned nearly Rs700 million as a supplementary grant to cover expenses for holding the first round of US-Iran peace talks.

The Economic Coordination Committee (ECC) of the cabinet approved a summary submitted by the defence ministry for the provision of a Rs10.2 billion supplementary grant for the Hangor Project of the Pakistan Navy under the Armed Forces Development Package (RAFDP)-2030, according to a finance ministry announcement.

Finance Minister Muhammad Aurangzeb chaired the ECC meeting.

The Rs10.2 billion has been given for the Hangor-class submarine, the first of which was handed over to Pakistan in April during President Asif Ali Zardari's visit to China.

Hangor-class submarines – armed with state-of-the-art weapons, advanced sensors and air-independent propulsion – will be key to preserving maritime order and stability in the region, according to the Pakistan Navy. These submarines will play a pivotal role in deterring aggression and ensuring the security of vital sea lines of communication across the Arabian Sea and the wider Indian Ocean region, it added.

The finance ministry said the ECC also approved Rs693 million for security arrangements undertaken during the Islamabad peace talks. Pakistan hosted the US and Iranian delegations in April for the first round of peace talks.

The committee appreciated the successful conduct of the talks and commended the efforts of all stakeholders involved.

The ECC also approved Rs7 billion for discretionary spending under the parliamentarians' schemes. The government had earlier slashed the budget for these schemes to Rs63 billion as part of an overall cut to the development budget. Prime Minister Shehbaz Sharif had directed a reduction of Rs173 billion in the federal development budget, including a Rs7 billion cut to these schemes.

The ECC restored the allocation, saying it would facilitate the continuity of development projects, prevent cost escalations and ensure the timely achievement of programme objectives. However, the government did not restore the allocation for critical water sector projects.

The ECC also approved Rs241 million for compensation-related expenditures arising from the suicide bomb blast at Imambargah Khadijah-tul-Kubra in Taralai, Islamabad; Rs528 million for the operational requirements of the Pakistan Land Ports Authority; Rs800 million for the procurement of fast patrol boats and associated infrastructure for the Pakistan Coast Guards; and Rs1.9 billion for the expansion of Safe City Islamabad.

The federal government wants to make fresh recruitments of 400 personnel for the National Cyber Crimes Investigation Agency, 219 for the Safe City project, 1,200 for the Islamabad Traffic Police and 400 for the Islamabad Capital Territory Police.

The ECC also approved Rs150 million for the operational requirements of the National Counter Terrorism Authority (NACTA) and Rs414 million for security charges relating to the Reko Diq project.

The ECC also considered a summary submitted by the information and broadcasting ministry and approved the release of Rs733 million in favour of Pakistan Television Corporation (PTVC) to meet salary requirements for June 2026.

The information ministry has not been able to make the PTVC a self-sustainable organisation, and taxpayers are funding the entity.

The ECC also approved Rs120 million to meet employee-related expenditures arising from revised salaries and allowances for parliamentary secretaries during FY 2025-26. The Rs120 million for paying higher salaries to parliamentary secretaries, who are members of parliament, was approved in the middle of the prime minister's austerity drive.

The finance ministry said the ECC approved two summaries regarding the placement of development funds into the current account of the Pakistan Infrastructure Development Company Limited (PIDCL), including Rs8.8 billion for the Karachi and Hyderabad urban infrastructure development packages and Rs2.8 billion for the parliamentarians' schemes in Khyber-Pakhtunkhwa.

The finance ministry, which should discourage the practice of supplementary grants, itself received a Rs1.3 billion supplementary grant from the ECC for the modernisation of the Pakistan Mint. The ECC also approved a Rs4.4 billion grant for the government of Gilgit-Baltistan to support current expenditure requirements and priority initiatives in the region.

The committee also approved the policy for the grant of budget honorarium and allowed the inclusion of the Ministry of Commerce, Ministry of Law and Justice, and the Office of the Accountant General Pakistan Revenues (AGPR) for doing routine budget-related work.

The ECC issued sovereign guarantees to facilitate Pakistan State Oil (PSO) in taking a Rs100 billion loan from Habib Bank Limited and the Bank of Punjab, Rs50 billion from each bank. The PSO is facing acute funding shortages as its receivables have crossed Rs903 billion, including a Rs543 billion principal amount. The SNGPL owes Rs563 billion to PSO.