ISLAMABAD - The National Economic Council (NEC) will meet today (Thursday) under the chair of Prime Minister Muhammad Nawaz Sharif to approve the developmental budget and macroeconomic framework for the upcoming financial year 2014-2015.

The NEC would consider the recommendations of the Annual Plan Coordination Committee (APCC) on development budget. The APCC has recommended the annual development budget at Rs 1.310 trillion for the next fiscal year 2014-2015, which is 13.42 percent higher than the target of Rs 1.155 trillion of the outgoing financial year 2013-2014.

The APCC on May 26, 2014 approved Rs 1310 billion development budget for next year including Rs 525 billion federal Public Sector Development Programme and Rs 650 billion for provincial development. Meanwhile, WAPDA, PEPCO and NTDC would invest Rs 135 billion from their resources, which is also part of national development programme.

Meanwhile, the NEC would also approve the macroeconomic framework for the next fiscal year, as already proposed by APCC that met under the chair of Federal Minister for Planning, Development and Reforms Ahsan Iqbal. The government has set GDP growth target at 5.1 percent for the next fiscal year as against the target of 4.4 percent of the outgoing financial year.

The growth of GDP for 2014-15 is targeted at 5.1% with contributions from agriculture (3.3 percent), industry (6.8percent) and services (5.2 percent). Nominal GDP is targeted to grow by 13.5% and GNP per capita is projected at Rs160,443. The growth targets are subject to risks like deterioration in energy availability, extreme weather fluctuations, non-implementation of envisaged reform programme and fiscal profligacy. The underlying assumption for inflation is 8%, which is consistent with fiscal prudence, stable exchange rate and responsive monetary policy. The investment is targeted to improve from current level of 14 per cent of GDP to 15.7 percent.

The increase in investment will be primarily contributed by the private sector while public sector will continue to support the private sector. Fixed investment will inch up from 12.4 percent to 14.1 percent of GDP. However, national savings are expected to improve from 12.8 percent of GDP in 2013-14 to 14.2 percent in 2014-15.

Meanwhile, exports for 2014-15 are projected to grow by 5.8 percent to $27 billion from $ 25.5 billion estimated for 2013-14. Imports during 2014-15 are projected to increase by 6.2 percent to $44.2 billion from $41.6 billion estimated for 2013-14. Hence, the trade balance is projected to be in deficit by $ 17.2 billion in 2014-15.

The NEC meeting would be attended by the four chief ministers and Prime Minister of Azad Jammu and Kashmir.