ISLAMABAD:
The government on Tuesday approved a supplementary budget of Rs 50 billion. to the armed forces to strengthen security at international borders, upgrade naval bases and continue to protect foreign commercial interests in Pakistan.
Of the total, Rs 39 billion has been earmarked for the military and barely Rs 11 billion for the navy, according to a decision by the Economic Coordination Committee (ECC) of the Cabinet.
The ECC meeting, chaired by Finance Minister Muhammad Aurangzeb, considered proposals related to national security, defence, food security and petroleum sector reforms, the finance ministry said.
“The ECC approved a summary of the Defense Division providing a technical supplementary grant of Rs 50 billion for various approved Defense Services projects,” the statement added.
These funds are allocated annually to projects outside the general defense budget. Last financial year, the ECC had approved Rs45 billion for similar initiatives.
ECC approved Rs 19 billion. to Special Security Division South – an increase of 19% on a year ago. The special southern department is responsible for protecting foreign commercial interests in southern regions.
Another Rs 8 billion was given to the Special Security Division North, responsible for protecting these in the northern parts. The amount corresponded to last year’s grant. ECC approved Rs 9.9 billion. instead of its internal security allowance, which was also equal to last year’s expenses.
An amount of Rs2 billion was approved for managing the fencing of the international borders with Afghanistan and Iran. The fences have been erected on the borders with Afghanistan and Iran to control smuggling and illegal movement of foreign nationals.
The ECC approved Rs11 billion for the Navy for upgrading two bases. Pakistan Air Force will get Rs 150 million for the internal security service. For the current financial year, the National Assembly had approved Rs2.556 trillion in defense budget for the regular expenditure of the three armed forces.
In another summary submitted by the Home Ministry, the ECC approved another Rs 841.6 million. as supplementary budget in support of border control operations, internal security and maintenance of law and order by the federal civilian armed forces.
New public company
The Finance Ministry said the ECC discussed a summary submitted by the National Food Security Ministry regarding the liquidation of Pakistan Agriculture Storage and Services Corporation (Passco) and the establishment of a new company.
The committee approved the formation of Wheat Stocks Management Company (WSMC) with an authorized capital of Rs350 billion. A grade-20 officer from the National Food Security Ministry has been approved to be the first executive director of the WSMC.
WSMC’s duties include raising new loans from the commercial banks to retire Passco’s liabilities. The outstanding liabilities of the Passco are Rs528 billion, but government estimates suggested that liabilities above Rs400 billion would be settled against receivables and by selling the wheat stocks.
The Ministry of Finance will issue state guarantees against the loans that the new company receives. The government will allocate money from the budget each year to pay the principal and interest on the loans to be taken out to settle the Passco obligations.
The government had abruptly shut down Passco without first finding an alternative to liquidating the storage company’s assets and liabilities. It has now decided to hand over the business of wheat procurement to the designated private entities and to set up a new company to take care of the assets and liabilities.
The ECC also approved exemption for the new company from the application of the 2023 State-Owned Enterprises Law on the grounds that the new public company would not carry out any commercial activities and would only take care of the outstanding obligations.
The ECC approved a supplementary budget of Rs100 million on the request of the Ministry of Home Affairs for the maintenance and repair of defense equipment used by the federal civil armed forces.
