ISLAMABAD:
The federal government has approved an expansion project for the Armed Forces Institute of Cardiology for Rs13 billion by utilising savings from the slow-moving ongoing schemes under the Public Sector Development Programme (PSDP).
Headed by Deputy Prime Minister Ishaq Dar, the Executive Committee of the National Economic Council (Ecnec) approved the expansion of the Armed Forces Institute of Cardiology (AFIC) and the National Institute of Heart Diseases (NIHD), Rawalpindi with a spending of Rs13 billion.
Out of the total allocation, Rs6 billion will be arranged from foreign sources. The project had been approved on Monday.
Ishaq Dar had tweeted that Ecnec approved four major development projects worth over Rs240 billion, which included the expansion of AFIC-NIHD Rawalpindi, Prime Minister’s Youth Skill Development Programme, Karachi Yellow Line BRT Corridor and Harpo Hydropower Project in Gilgit-Baltistan.
The Central Development Working Party (CDWP), which is chaired by Planning Minister Ahsan Iqbal, had recommended Ecnec that due to fiscal constraints the project should be funded outside the PSDP.
Out of the total cost, Rs10.5 billion is earmarked for capital work, and the remaining amount is allocated for consultancies and any contingent liability. The expansion is being undertaken to augment the tertiary-level cardiac care facility by adding additional hospital infrastructure. AFIC treats both military and civilian patients and the hospital is treating patients beyond its capacity.
Ecnec was apprised that the existing federal cardiac care infrastructure was insufficient to take patient load, resulting in congestion, delayed care and increased referral pressure on other public sector hospitals.
In December, the CDWP had recommended the project to Ecnec with the request that, given the limited availability of PSDP funds, the project should be financed through non-PSDP sources, according to the Ecnec summary.
For the current fiscal year, the government has allocated Rs50 million for the expansion of AFIC facilities against the total cost of Rs13 billion.
The CDWP had further recommended that the utilisation of the existing PSDP allocation of Rs50 million should be done after third-party vetting. It also directed that procurements should begin only after the full Rs13 billion funds were arranged.
But the Ecnec chairman, who happens to be the deputy prime minister, was of the view that the federal government should arrange financing from the PSDP and may divert savings, if any, from the existing allocation for various projects towards the AFIC project.
For the current fiscal year, the authorities need Rs2 billion out of the total requirement of Rs13 billion, according to officials.
During the CDWP meeting, Planning Minister Ahsan Iqbal had observed that the PSDP was already fully stretched and the approval of projects of this magnitude inevitably results in displacement or under-funding of other national priority projects, according to minutes of the CDWP meeting. It was further observed that there was no fiscal space to accommodate large new projects without adversely affecting the overall development portfolio.
The Ministry of Defence had been advised to approach the Ministry of Finance for fiscal support. But official records showed that the finance ministry clarified that under the prevailing budgetary framework, no grant financing was available for projects outside the PSDP and therefore no financial commitment could be assured beyond the approved PSDP allocations.
Ecnec also approved the revised Prime Minister’s Youth Skill Development project for a period of four years (2023-2027) at a total cost of Rs23.5 billion. The project has a cumulative allocation of Rs12.9 billion for this fiscal year.
Under the project, information technology skills will be imparted to 79,250 youth, and 78,500 youngsters will be given industrial training. About 63,500 will be provided with conventional skills training.
Mass transport project
Ecnec approved the Rs178.5 billion Karachi Yellow Line project. The government of Sindh will provide funding by taking a $550 million loan from the World Bank. The loan will be repaid over a period of 18 years.
The original project had been approved in 2019 for Rs61.4 billion. The project required revision primarily due to price escalations and to incorporate design improvements aimed at enhancing resilience and a sustainable transport system. There was also a 29% increase in unit cost, which significantly pushed up the overall cost of the project.
The revised project envisages the construction of a 21km-long dedicated Bus Rapid Transit System with 28 stations, and 256 buses are being purchased to accommodate 300,000 passengers daily.
