ISLAMABAD: Pakistan on Friday announced a 40 per cent increase in its development budget over the next financial year as the government continues to invest in infrastructure projects.
Speaking to parliament, Finance Minister Ishaq Dar said the Public Sector Development Program would have its funding increased from 715 billion rupees ($6.8 billion) to 1,001 billion rupees for 2017-18.
The government also announced an 11 per cent hike in total expenditure over the next year, as positive financial indicators and an improving security situation attract more investors to the country.
“The estimate for the total expenditure in the year 2017-18 is 4,753 billion rupees, which is 11.7 per cent more than the previous year’s expenditures of 4,256 billion rupees,” Dar said.
The defence budget has been increased from 841 billion rupees to 920 billion rupees.
On Thursday, the government said its economy expanded almost 5.3 per cent, its largest increase in a decade.
The rise follows a construction boom linked to a $50-billion Chinese investment plan to upgrade transport and power infrastructure.
Confidence in Pakistan is growing, with the International Monetary Fund saying in October that the country had emerged from crisis and stabilised its economy after completing a bailout programme.
Pakistan’s credit rating has also improved, though foreign investment remains poor compared to its South Asian neighbours.
Economists believe the country will need to register sustained growth of six to eight per cent over several years to make a significant dent in poverty and provide enough jobs for its youth.
