ISLAMABAD - Islamabad Chamber of Commerce and Industry (ICCI) has expressed dissatisfaction with the low disbursement of funds for the public sector development projects (PSDP), saying this would affect the pace of work on these projects, thus leading to costs overruns.

ICCI Acting President Sheikh Pervez Ahmed, in a statement issued here on Saturday, said being a developing country, Pakistan needed to spend more on developmental works to improve its economy. “Less spending on PSDP will keep the country deprived of better economic growth,” he lamented.

He said the government had allocated Rs700 billion in budget 2015-16 for PSDP, but disbursed only Rs.429 billion during the first 10 months (July-April) of this fiscal year, which reflected its lack of commitment to sustainable economic development of the country. He said the government had claimed that PSDP 2015-16 would help in achieving long-term development objectives, given in Vision 2025.

“However, I am afraid that less spending on developmental works would hamper these efforts, and hold back the economy from unleashing its full potential,” he expressed the fear. Sheikh said as per government’s approved disbursement mechanism, 80 percent of the total PSDP allocations should be utilised in 10 months of a fiscal year, but the government disbursed 67 percent of these funds during the first 10 months of the financial year 2014-15, and only 61 percent during the same period of this fiscal year. He said it was a matter of concern for the policymakers.

“Less spending on PSDP will deprive the private sector of new business opportunities and retard the overall GDP growth of the country,” he predicted.

He said Pakistan needed a strong network of roads, especially from rural areas to markets to facilitate the growth of business activities.

He, however, lamented that only 40 percent of the allocated funds had been disbursed for the road sector so far, which would impede all efforts to improve roads infrastructure in the country.

ICCI acting president called upon the government to avoid making cuts in the development budget to limit fiscal deficit of the country.

He opined more allocations for PSDP would lead to the growth of private sector, attract more foreign investment to the country, encourage industrialisation, generate lots of job opportunities, reduce poverty and pave way for sustainable economic growth of the country.