National Budget for fiscal year 2007-08

Society Pakistan & World Affairs
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Re: National Budget for fiscal year 2007-08

I once worked with Ahsan Iqbal and although he is one of the sicerest sounding and relatively knowledgable person in the Pakistani parliment, some of his criticism is biased due to his political inclinations.

Professor Khurshid is the only person I like from JI, he is also a knowledgable person and his critiques on other government plans have been an interesting read, his own party has failed to use those ideas which he presents for others in his criticism. Lets see what he has to say when the NWFP budget is presented.

FOL, if you have the criticism from these 2 gentlemen in digital form, kindly post it here.

Played in the Rain?
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Re: National Budget for fiscal year 2007-08

Common Man doesn't Pay taxes.

Iam surprised on this statement, from buying of needle to the life saving drugs, COMMON MAN is forced to pay tax. though never saw thats tax returned to them! yet what they see is their tax money is spent to buy politicians and create anarchy in the country.

e.g The Surcharge we pay to WAPDA for electricity, what we get in return, Low Voltage, Load-Sheding... as per my info and observation that surcharge which is charged to common man is electricity bills of those who are sitting in Assemblies or wearing uniforms.

when common man see his money ( which btw is not easy to make) is spent like that, he tries to find ways to save it.

iam simply amazed that u have accused common-man and ignored the root of the problem.. MAN IN POWER

Bhai sab Common man is forced for corruption.

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Re: National Budget for fiscal year 2007-08

Superb budget. :k:
About a decade ago our national budget was a mere $10 billion in total - now we have been able to treble that under the Musharraf-Aziz economic transformation of Pakistan.

Pakistan unveils 31 billion dollars pro-development budget

Pakistan on Saturday unveiled an over 1.87-trillion-rupee (about 31 billion U.S. dollars) budget for the upcoming 2007-2008 fiscal year(July 2007 to June 2008), which envisages a pro-development expenditure. The budget was presented by Pakistani State Minister of Finance Omar Ayub Khan in the National Assembly, lower house of the parliament. It proposes a record 520-billion-rupee allocation for development and welfare of people, out of which 52 percent will be spent on infrastructure development and 48 percent on welfare of people and on social sector. Under the budget, Pakistan will spend 275 billion rupees on the defencs of the country, up from 250 billion rupees of last fiscal, so as to secure a “credible deterrence and invincible defence.” Khan said the government has also decided to increase pension of government pensioners by 15 to 20 percent, and minimum monthly wage for unskilled workers will also be increased from 4000 to 4500 rupees.

Besides, to expand the access to daily edibles at lower prices to more people, the government has decided to increase the number of Utility Stores by additional 5000 and provide a utility store at every Union Council in the next 4 months. Pakistan also decided to spend more on measures to facilitate youth employment, water purification, expand electricity supply and medical access, etc. As the country’s economy entered the fourth year (the fiscal 2006-2007) of above 7.0 percent growth, its poverty headcount had fallen from one-third to less than one-fourth of the 160 million-strong population, according to a government economic survey unveiled on Friday. The survey said Pakistan’s per capita income in dollar term has grown at an average rate of 13 percent per annum during the last five years rising from 586 dollars in 2002-2003 to 833 dollars in 2005-2006 and further to 925 dollars in 2006-2007.

http://news.xinhuanet.com/english/2007-06/10/content_6220995.htm

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Re: National Budget for fiscal year 2007-08

Development outlay pegged at Rs724bn

The government on Saturday announced a Rs724 billion development budget for fiscal year 2007-08, including a Rs520bn Public Sector Development Programme (PSDP), with a special allocation of Rs37.6bn for land acquisition to build five major dams, including the controversial Kalabagh dam. Out of the total PSDP, the federal government’s share has been fixed at Rs335bn and that of the provincial governments at Rs150bn. Both of which have been increased by 24 and 30 percent, respectively, from what was allocated for the outgoing fiscal. Besides, the government corporations will spend Rs204bn that is outside of PSDP. **The PSDP unfolded by Minister of State for Finance and Planning Omar Ayub Khan in the National Assembly on Saturday revealed an increase of 19.54 per cent or Rs85bn against the current year’s Rs435bn. **An amount of Rs35bn has also been allocated for the earthquake reconstruction and rehabilitation programme in addition to the Rs335bn development programme. The infrastructure sector, which includes water, power and roads projects, has been given the main share of the total PSDP allocation. The sector will get Rs139.7bn or 41.7 percent of the federal PSDP. The remaining amount has been distributed between social and other sectors. In infrastructure, a huge chunk of Rs84.15bn will go to the water and power sector to implement the ongoing and new projects. This includes Rs63.55bn for water and Rs20.60bn for the power sector. In the power sector, Rs72.83bn will be outside PSDP and will be generated by the sector itself. On balance, the sector will receive a total of Rs157bn.

Mega dams for which more than Rs37bn have been earmarked include Kalabagh, Basha, Akhori, Munda and Kurram Tangi. The allocated amount will be spent mainly on acquisition of land for the proposed dams during the next fiscal year. The total cost of new hydel projects, which are given in the power sector under PSDP, has been estimated at Rs16.01bn, and for the Alternative Energy Development Board projects Rs148 million have been allocated.
Among the ongoing power-sector projects, the Neelum Jehlum hydropower project was allocated Rs10bn, Basha Diamer Dam project Rs500m, Golan Gol Hydro power project, Chitral, Rs450m, Khan-kwarhydro power project, NWFP, Rs700m, Allai Khawar hydro power project, NWFP, Rs1bn, and Dubir Khawar hydro power project NWFP Rs1.5bn. All the eight electric power distribution companies have been allocated Rs5.5bn for their projects. These include 6th secondary transmission and grids project (Rs8.968 bn) for their distribution and system augmentation programme, Rs2.585bn and another Rs2.915bn have been allocated for these distribution companies’ rehabilitation, distribution, renovation and augmentation projects. For the ongoing water-sector projects, Rs20bn have been allocated for Mangla raising project, Rs500m for Mirani dam, Rs200m for Sabakzai dam, Rs2.847bn for Kurram Tangi dam, Rs900m Satpara multipurpose dam and Rs600m for Gomal Zam dam. Besides, Rs870m have been allocated for the construction of 20 small dams in the NWFP, and Rs67m for carrying out feasibility studies on small dams in the same province. Irrigation projects also have been allocated a sizeable amount as Greater Thal Canal (P-I) and Rainee Kanal each has got Rs2.5bn. Kachhi Canal has been allocated Rs8.5bn, lower Indus right bank irrigation and drainage, Sindh, Rs1.9bn and revamping/rehabilitation of irrigation and drainage system of Sindh Rs2bn.

Special areas programme will get Rs34.42bn in the next fiscal year, including Rs4.42bn for the Khushhal Pakistan Programme (KPP-I), Rs10bn for the Khushhal Pakistan Fund (KPF) and Rs20bn have been allocated for KPP-II that will include Rs10bn for new and Rs5 billion for old projects. Five billion rupees will be spent on village electrification through alternative energy sources.
Allocation for communication sector stands at Rs29.61bn and Rs6bn will come from outside PSDP for various projects. For the National Highway Authority (NHA), Rs25.917bn billion have been allocated for the ongoing projects. Of which Rs18.275bn will come from PSDP and the rest from foreign loans. On new NHA projects, Rs3.08bn will be spent which also include Rs0.8bn foreign loans. Under NHA allocation, Rs1.8bn are for Makran coastal road Balochistan, Rs1bn each for Islamabad-Peshawar Motorway (M-I), Lyari Expressway, Islamabad-Muzaffarabad Road and Indus Highway project Phase-III. Besides, Rs1.5bn have been allocated for Lowari Tunnel and Access Road, Rs1.8bn for Gwadar-Turbat-Hushab section. For new projects, besides others, Rs1bn have been earmarked for acquisition of land for Faisalabad-Khanewal Expressway (184km). Under the development plan, the Pakistan Railways will get Rs11.64bn, including Rs420m for new projects and Rs7.91bn for ongoing projects. Eighteen billion rupees will be spent on higher education, which includes 397 ongoing and new projects to develop and improve universities in the country. For food, agriculture and livestock development, Rs15.79bn have been allocated with special focus on livestock production and development, agribusiness development, improvement of watercourses, land and water resources’ development, food security and research in the agriculture sector.
In health sector, Rs14.27bn have been allocated for construction of new hospitals, family planning and primary healthcare centres, TB control, HIV/AIDA control, research and development, training, establishment of laboratories and construction of medical towers. An amount of Rs9.5b has been earmarked for industries, production and special initiatives. Under the sector, Rs6.5bn have been allocated for clean drinking water for all, Rs365m for Gujranwala Tools, Dies and Moulds Centre, Rs250m for gem and jewellery development, and Rs500m for marble and granite sector development. The finance division will get Rs16.96bn, Planning Commission Rs14.43bn, Interior Division Rs9.5bn, Defence Division Rs9.5bn, and Commerce Division Rs1.579bn. For the textile sector, the government has allocated only Rs828m, for law and justice Rs3.526bn, ports shipping Rs757m, education 6.51bn IT and telecommunications 3.21bn, science and technology Rs3.6bn, population welfare Rs4.33bn, women development Rs163m, social welfare and special education Rs428m, labour and manpower Rs198m, Overseas Pakistan Division Rs5m, KA & NA Division Rs13.722bn, State and Foreign Region Division Rs7.5bn. For environment division Rs1.62bn have been allocated, local government and rural development Rs128m, culture Rs378m, sports 522.7m, youth affairs Rs152m, tourism Rs167m, statistics division Rs263m. The Cabinet Division will receive Rs494.8m, housing and works Rs1.21bn, foreign affairs Rs579m, narcotics control Rs277m, information and broadcasting Rs1.54bn, establishment Rs503m, law justice and human rights Rs4.02b, revenue division Rs2.53bn, defence production division Rs526m, National Reconstruction Bureau Rs50m and economic affairs division Rs10m.

http://thenews.jang.com.pk/daily_detail.asp?id=59851

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Pakistan Lifts Salaries, Subsidies Ahead of Elections

Pakistan’s government raised salaries and pensions and increased subsidies on basic foods including lentils, tea and cooking oil, aiming to allay voter concerns about inflation ahead of elections. The South Asian nation’s 3.5 million civil servants will receive a 15 percent salary increase and their pensions will be lifted as much as 20 percent, junior Finance Minister Omar Ayub Khan said in his budget speech in parliament in Islamabad today. The minimum wage for other workers will also be increased. Prime Minister Shaukat Aziz, a former Citibank executive who is enticing foreign investors and selling state assets, faces re-election in January with consumer prices rising at three times the pace they were before the previous poll in 2002. Political violence in Karachi last month, the worst since President Pervez Musharraf seized power in a military coup in 1999, may also cost the government votes. Political disturbances seem temporary and economic policy will maintain its direction even if there is a change of government,'' said Tanvir Ahmed Shaikh, president of the Karachi-based Federation of Pakistan Chambers of Commerce and Industry. There’s a good show on and the government will try to keep it going.‘’ Pakistan’s government expects the economy to expand 7.2 percent in the year starting July 1, accelerating from 7 percent in the previous 12 months. Growth has averaged 7.5 percent in the past four years.

`Transformed Pakistan’

``We have transformed Pakistan into one of Asia’s fastest growing economies and come a long way in the last eight years,‘’ Khan told parliament. Faster growth is fuelling inflation, which has averaged almost 8 percent in the past year, compared with 2.5 percent at the time of the last parliamentary elections in 2002. That’s increasing food prices in a nation where about 70 percent of the population of 160 million people lives on less than $2 a day. The minimum wage will be raised to 4,500 rupees ($74) a month from 4,000 rupees to help lower-income workers cope with higher prices, Khan said. Aziz’s government is also increasing development spending to ensure the faster growth needed to reduce poverty isn’t hampered by inadequate infrastructure. Outlays on development projects including power, health and education will rise 25 percent to 520 billion rupees, Khan told parliament.

Foreign Investment

Infrastructure has been neglected over the decades,'' said Ahsan Javed Chishty, an economist at Standard Chartered. The 2008 fiscal year is an election year and the government is running an augmented development spending program.‘’ Better infrastructure should help Pakistan attract more foreign investment. Overseas companies including Philip Morris International and ABN Amro Holding NV are increasing their presence in Pakistan to take advantage of spending by a middle class of 30 million people that Standard Chartered estimates now earn an average of about $10,000 a year. Pakistan’s textile industry, the nation’s biggest employer of industrial workers, will now pay a flat 1 percent withholding tax on their exports, Khan said. That should help the government achieve its goal of next year lifting textile exports, which make up more than 60 percent of overseas sales, by a quarter to $15 billion.

Bond Sales

Pakistan will take advantage of heightened overseas interest to sell $500 million in foreign-currency bonds next year. The nation last month raised $750 million selling foreign currency bonds in its fourth debt offering in three years. Subsidies on fertilizer, power and food will rise by about 6 percent to 113.9 billion rupees, according to budget papers, boosting agriculture growth. Farmers will receive a 25 percent subsidy on electricity costs, Khan said. The government is keen on public sector development which will help it remain popular,'' said Nasim Beg, who oversees the equivalent of $320 million in stocks and bonds as chief executive of Arif Habib Investment Management Ltd. in Karachi. This is especially evident by incentives for farmers and salary increases for government employees.‘’ Pakistan’s farm production, which accounts for about a quarter of the $146 billion economy, is forecast to expand 4.8 percent next year. The construction industry may get a lift as real estate investment trusts will now be exempt from tax, according to budget documents. As many as 30 new office towers with more than 25 stories are scheduled to be built in Pakistan in the next few years, compared with only two buildings of similar dimensions in the past three decades, according to Standard Chartered.

http://www.bloomberg.com/apps/news?pid=20601080&sid=a5piwyEmzDvU

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Re: National Budget for fiscal year 2007-08

Hanibal, your argument seem to be based on the assumption that everyone pays their taxes and utility bills in Pakistan. GST is a recent phenomenon, not even a decade old and it was imposed mainly due to dishonesty of people not paying their taxes.

GST however is not the only tax people in other countries pay.

The only people who pay taxes are the salaried govt employees whose tax is deducted from paycheck. Then there are a few private concerns who follow the same principle.

Fact is most Pakistanis dont pay any taxes.

Low voltage and load shedding is the result of what? The small percentage of people who do pay their bills honestly are the ones who suffer. You know even in bigger cities like Karachi, Lahore, Islamabad, Pindi and Peshawar people by pass meters. The low voltage is the direct result of people A/C bypassing the meter. They use more juice than their transformer can supply and their electricity bills only represent the amount of electricity consummed by running the water pump. This chori is more rampant in rural areas. Ask people in tribal areas and most of NWFP.

Yes common man is forced for corruption, but not due to poverty but his greed.

One point that I failed to touch on from your earlier post was about the need for strong institutions. I whole heartedly agree. We need stronger institutions, but then again who makes these institutions? You, me and people exactly like us. The reasons we do not have strong institutions is because we are ourselves corrupt. We like to blow the moral horn when it comes to others but when it comes to us we are the first ones to bribe the electrician to bypass our airconditioners.

The day we fix ourselves, things will start changing.

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Re: National Budget for fiscal year 2007-08

The government says that defence expenditure has been decreasing as a percentage of total gross domestic product for the last five years. Defence spending was 6.5 percent of GDP a few years ago, but has now come down to 3.5 percent of GDP. Daily Times

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Ther is a huge difference b/w 2 trilion and 1874 billion…

The outlay of the budget at Rs 1874 billion, is a record in the history of the country. However this figure quoted in the budget speech on the floor of the house is at variance with the budget document which puts the size of the budget at Rs 1599 billion.

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Re: National Budget for fiscal year 2007-08

The federal budget for 2007-08 with an outlay of Rs 1.599 trillion presented in the National Assembly on Saturday contains huge subsidies and relief for the masses and the public sector entities.
http://thenews.jang.com.pk/top_story_detail.asp?Id=8407

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Re: National Budget for fiscal year 2007-08

10 industrial sectors offered benefits

The government has launched an aggressive programme for the business class to boost their profits and protect their investments by offering incentives to more than 10 industrial sectors in the budget 2007-08. The largest benefit goes to the textile sector that has been offered a two-way package on polyester staple fibre (PSF). The local units producing the PSF would be given subsidy (Research and Development Fund), while the importers of PSF would get duty drawbacks as well as duty-free import facility. Other businesses benefiting would be compressed natural gas (CNG) compressors; paper and paperboard; items/equipments which have dedicated use in non-conventional/alternate renewable energy resources like solar, wind and biotech; gum base (seven raw materials duty zero-rated); transformers, submersible motors, electricity metres, switchgears and electric bulbs and tube lights; light engineering products; polystyrenes and their raw materials; energy saving lamps and its raw materials/ parts; petroleum bitumen/asphalt; footwear; football bladder; aviation equipment. New sectors/ sub-sectors have been added under the incentive regime for local manufacturing duties halved on scores of items or zero-rated.

The existing exemption regime available to different industrial segments has been abolished after the launch of the fresh facilitation sectoral programme. The budget also launched a reduction and elimination of duty for introduction of second-generation tariff policy reforms for the following: gems and jewellery; furniture; marble and granite; horticulture; surgical equipment/medical devices; poultry feed items, poultry vitamins, evaporation air coolers, insulated; sandwich panels and silos for storage of poultry have been exempted from duty. Further benefits offered to the business came in the shape of safeguards intended to ward off the onslaught of foreign goods. For this purpose, duty rates have been increased on import of poultry meat, welded stainless steel pipes, etc. Duty rates on vehicles have been increased around the effective rate of capital value tax (CVT) that has been merged in customs duty. For up to 800cc cars, there was no CVT, therefore, the rate of duty against these vehicles has not been changed. The relief measures also included an amnesty scheme for condoning delays in submission of installation consumption certificates, etc. Another amnesty from payment of fine/penalties and surcharges on payment of principal amount has also been offered. Launching these incentives, the budget documents says: In order to enhance local industrialization, capacity building, production competitiveness efficiency and product presentability, duty rates on raw materials, parts and components for manufacturing of these items/products have either been reduced or eliminated. Other measures in this direction include the following: downward revision of five years capping to three years for import of old/used cars/jeeps; five years tariff plan for auto sector; reduction/elimination of duty rates on specified diesel generating sets; inputs used by the newspaper industry are being provided at concessionary rate; duty rates on equipments for broadcasting sector have been reduced to five per cent; extension of incentives for expansion and upgradation of existing hospitals; inclusion of PSF in Duty and Taxes Remission for Export (DTRE) scheme, payment of duty drawback and R&D support.

http://thenews.jang.com.pk/top_story_detail.asp?Id=8413

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Re: National Budget for fiscal year 2007-08

http://news.yahoo.com/s/afp/20070609/wl_sthasia_afp/pakistaneconomybudget;_ylt=A0WTUc1J8WpGkYABNAFvaA8F

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Re: National Budget for fiscal year 2007-08

Revenue collection target set at Rs1 trillion - up 22.37%
http://www.dawn.com/2007/06/10/nat4.htm

Tax revenues has more than trebled under the Musharraf-Aziz govts.

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Re: National Budget for fiscal year 2007-08

Shhhh. Don’t say it out too loud. The supporters of ‘bhagorays and lootairays’ are already in shock, and cannot believe how the so called dictator and his govt. have achieved so much. Yet, their ‘bhagoray and lootairay’ leaders could do nothing for the nation whilst in power - except line their own pockets :smiley:

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A good post that reflects the ground reality, as opposed to the dream world these MQM supporters want us to believe in

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SSSHHH, the MQM people want us to believe everything is going great, ignore the realities of the situation!!

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Re: National Budget for fiscal year 2007-08

Subsidy on DAP fertilizers increased

The government here on Saturday announced 20 per cent subsidy on electricity charges for tubewells and increased subsidy on DAP fertilisers from the existing Rs400 per bag to Rs470. The centre and provinces will share the subsidy. The increase in the subsidy is supposed to bring down prices of the vital fertilisers by Rs70 per bag. “This is the subsidy of billions of rupees which will directly benefit farmers,” said Minister of State for Finance, Omar Ayub Khan, in his budget speech here on Saturday. The minister, however, did not give the exact figure of the total subsidy on DAP, to be extended to farmers in 2007-08. In this year’s budget, the government has allocated Rs336 million for production of better seeds. Fifteen new seed-testing laboratories will be set up. For better production of cotton, BT Cotton seeds and Bio-Safety arrangements will be introduced.Better availability of seeds is likely to cause 20 to 30 per cent increase in agricultural output next year. In this year’s Public Sector Development Programme (PSDP), the government has allocated Rs15.8billion for 48 ongoing and 15 new projects. The government has allocated Rs6billion for an ongoing national programme for improvement of water courses in Pakistan and Rs2.8billion for Land and Water Resource Development Project for Poverty Reduction in the country. Among the new projects, Rs100m has been earmarked for agriculture and shrimp farming project, Rs470m for special programme for food security and productivity enhancement of small farmers in 1012 villages called Crop Maximisation Project-II, Rs140m for improving productive efficiency of cattle and buffaloes in small holders production system, Rs100m for bio-saline agriculture programme, Rs50m for fisheries training centre at Gawadar and Rs40m for the National Institute of Genomics and Advanced Bio-technology. Allocations for the ongoing projects include Rs948.4mn for the PARC to improve its research capabilities, Rs327 million for National Programme for Control and Prevention of Avian Influenza, Rs100 million for up-gradation of Central Cotton Research Institute, Multan, and Rs164 million for establishment of facilitation unit for participatory vegetable seed and nursery production programme.

http://www.dawn.com/2007/06/10/ebr4.htm

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Re: National Budget for fiscal year 2007-08

Customs duty reduced on 400 tariff lines

The government on Saturday reduced customs duty on more than 400 tariff lines of raw materials and machinery, introduced a zero tariff slabs in customs tariff and announced a package of incentives for the textile industry. Through the Finance Bill 2007, the cascading principle in tariff rates maintained as guiding principle (primary raw materials 0 per cent — 5 per cent, secondary/components at 5 — 10 per cent and finished goods at 20 - 25 per cent) and adopted the new tariff classification scheme aligned with HS 2007 version to be effective from next fiscal year. The government has announced to give duty drawback on import of polyester staple fibre (PSF) in proportion of the duty paid on it to textile sector. The government has also allowed import of PSF under DTRE scheme. To compensate the local manufacturers of PSF, the government will give local manufacturers of PSF a subsidy at the rate of 3.5 per cent. It has been proposed to exempt raw material and components for local production of CNG processors, the non-conventional energy sources equipment exempted from both sales tax and customs duty; duty exempted on gum raw materials; around 14 items of poultry sector exempted from custom duty. The government has also been zero rated on sports football bladder raw materials; duty reduced to 5 to 10 percent from 20 to 10 percent on components on electrical transformers; duty reduced to 5 to 10 percent on swittcharges raw materials, printing plates.

http://www.dawn.com/2007/06/10/ebr16.htm

Re-Use Clothes ?
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Re: National Budget for fiscal year 2007-08

Text of budget speech for 2007-08
http://www.dawn.com/2007/06/10/ebr3.htm

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Mashallah.

Ya Allah, Pakistan ko aur taraqi karnay ki taufeeq ata farma. Ameen.
Ya Allah, Pakistan ko bhagoray aur lootairon sai, aur un kai chahiton sai bacha kar rakh, jo Pakistan ka foreign reserve dekh kar aur mulk ki taraqi dekh kar jal rahai hain. Ameen suma ameen.

Pakistan Zindabad :jhanda:

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Re: National Budget for fiscal year 2007-08

My dear brother,

Tell what benefits salaried persons are getting for paying taxes? so that other will get motivated

I agree there are lot more other taxes paid in other countries, same as we do, but in those countries that tax money is used for providing infrastructure and facilities to people, do we get that? generally it is said that people dont pay tax, then how come CBR is able to get 60% of the target or what ever percentage!!! who are those people who pays 60% of the target?, dont tell me they are "farishtay" (as their duty is to caste vote only) ???

I agree there are people involved in bijli-Chori, there are certain measures to avoid it... but govt is not ready to do so ! y coz that way the big theives cannot steel.. same applies in every aspect/sector

. what does they get? other than misery. poor medical treatment, poor education infrastructure, is this what other people get in other countries for their tax money???

Unless and untill govt. start spending the money in the benefit of the people, one can only dream to increase tax payers!!!

One more thing i like to touch, is we, i.e. u & me and other people like us are basically not corrupt. (economically speakin) corruption is a top down approach. in a sentence it can be said that if a King take one apple for free, his officers eat every bush available.

I agree, we need to fix ourselves, we need to thing longterm, we need to make this country a place to live.