The National Economic Council (NEC) convenes today to consider and approve the overall development plan and set a GDP growth target of 3.6% for the next fiscal year (2024-25). The meeting, presided over by Prime Minister Shahbaz Sharif and attended by provincial Chief Ministers and NEC members, will also review the annual plan for the outgoing fiscal year (2023-24) and the 13th 5-year plan (2024-29). A critical agenda includes approving the federal public sector development program (PSDP) and the provincial development plans.
The proposed federal development outlay for the next fiscal year is Rs 1.221 trillion. Concurrently, the provincial governments of Sindh and Punjab have shared their development plans totaling Rs 1.463 trillion, with Punjab proposing Rs 700 billion and Sindh Rs 763.7 billion. This combined outlay of Rs 2.6 trillion is likely to be approved during the meeting.
The Ministry of Planning, Development, and Special Initiatives is expected to propose a GDP growth target of 3.6% for the next fiscal year. This target comprises a 2% growth in the agriculture sector, 4.4% in the industrial sector, and 4.1% in the services sector. These figures reflect a balanced approach aiming to bolster overall economic stability and growth.
The federal PSDP of Rs 1.221 trillion, as approved by the Annual Plan Coordination Committee (APCC), focuses significantly on infrastructure projects, with Rs 877 billion allocated as follows:
Energy Sector: Rs 378 billion Transport and Communication: Rs 173 billion Water: Rs 284 billion Physical Planning and Housing: Rs 42 billion Social Sector: Rs 83 billion (Health: Rs 17 billion, Education including HEC: Rs 32 billion, Others: Rs 34 billion)
Special Areas (AJ&K and GB): Rs 51 billion Merged Districts: Rs 57 billion Science and IT: Rs 104 billion Governance: Rs 29 billion Production Sectors: Rs 21 billion Food and Agriculture: Rs 14 billion Industries: Rs 7 billion
The proposed Annual Development Plan (ADP) for Punjab is Rs 700 billion, which includes Rs 577.4 billion from local resources and Rs 122.6 billion from foreign aid. Similarly, Sindh’s ADP is proposed at Rs 763.7 billion, with Rs 430 billion from local resources and Rs 333.7 billion from foreign aid.
During the NEC meeting, the council will review the progress report of the Executive Committee of the National Economic Council (ECNEC) and the Central Development Working Party (CDWP). These reviews are crucial for assessing the public investment of the current fiscal year (2023-24) and formulating strategies for the upcoming fiscal year (2024-25).
The proposed development plans and the set growth target are indicative of the government’s strategic priorities. By focusing heavily on infrastructure, energy, and social sectors, the government aims to create a conducive environment for economic growth. The significant allocations for special areas and merged districts underscore the commitment to inclusive development.
The agriculture sector’s targeted growth of 2% is crucial, given its foundational role in the country’s economy. The industrial sector’s 4.4% growth target reflects efforts to revitalize manufacturing and other industrial activities. The services sector’s 4.1% growth target aligns with the global trend towards a service-oriented economy.
