The Federal Government is likely to impose a cut of up to Rs. 100 billion on the Public Sector Development Programme (PSDP) 2022-23. The PSDP is the key government expenditure that impacts growth rate directly. To help the flood-affected areas with additional funds, the Planning Commission is evolving a mechanism for imposing cuts.
The fast-moving, important and new PSDP projects are likely to be exempted from the cut while the slow-moving and less important projects will face the brunt, a source said. There are three components of the Federal Developmental Outlay which include the rupee component, Foreign Exchange Component(FEC) and Viability Gap Fund (VGF).
The fund can be surrendered to the Prime Minister Flood Relief fund, Finance Division or Accountant General, he said.