Planning Minister Ahsan Iqbal on Thursday said the development of Balochistan is a priority of the government, maintaining the province is on an “accelerated” path with Rs. 230 billion earmarked for it in the proposed budget for FY2025-26.
Addressing a press conference in Islamabad, he said the development of Balochistan was a national responsibility, in line with the directives of Prime Minister Shehbaz Sharif. He said authorities aimed to transform the socioeconomic landscape of the province over the next two years through targeted investment in critical infrastructure projects to improve connectivity. Among these, he said, is the N-25 Chaman-Quetta-Karachi highway, for which Rs. 100 billion has been allocated.
Additionally, he said, work would accelerate on the M8 and several other regional infrastructure schemes aimed at boosting connectivity, promoting investment, and ensuring inclusive development.
The minister emphasized the government’s commitment to water security following India’s holding of the Indus Waters Treaty in abeyance, saying this required the completion of critical reservoir projects on priority basis. Regretting that India has attempted to use water as a weapon, he warned that Delhi may try to disrupt flows, hampering the country’s available water. To counter this, he said, the government was prioritizing the Diamer-Bhasha and Mohmand dams, which have a storage capacity of 6 million acre feet and around 1 million acre feet, respectively.
Acknowledging limited fiscal space due to structural constraints, Iqbal said this had reduced the government’s ability to fund projects under the Public Sector Development Program (PSDP). He noted the development budget had declined from 2.6% of GDP in 2017-18 to just 0.8% now, adding the government plans to utilize domestic resources for future development. However, he stressed, this requires the country to raise its tax-to-GDP ratio to at least 16%.
Economic progress
Hailing improving economic indicators, he credited these to the unpopular decisions of the incumbent government. He said the government had sustained development funding even amidst the 2022 floods, noting the PTI-led government had withheld funds for an entire quarter, hampering development.
The minister claimed the government’s development plan, under Uraan Pakistan, was already bearing fruit, with GDP projected to rise from 2.7% to 4.2% in the coming fiscal year. Achieving this, he stressed, required enhancing exports and increasing revenues.
During the press conference, Iqbal also weighed in on the upcoming National Finance Commission (NFC) meeting, saying it should be delinked from a “regressive” population-based formula for distributing divisible pool resources.
Noting the current formula incentivized unchecked population growth rather than discouraging it, he said the center would propose linking allocation of funds to climate adaptation and other social sector indicators. He also lamented that the devolution planned under the 18th Amendment and the 7th NFC Award remained incomplete.