The National Assembly Standing Committee on Finance supported on Wednesday increasing the budget of the Foreign Affairs Ministry by 40 percent, but unanimously agreed that the defence budget should be curtailed to within three percent of the Gross Domestic Product (GDP) for the next fiscal year. The meeting of the committee was held in-camera and was chaired by Fauzia Wahab. Secretaries and senior officials of the Defence Ministry and Foreign Affairs Ministry briefed the committee on their budget demands.
The committee was briefed on the defence budget by Defence Secretary Lt General (r) Syed Athar Ali. The armed forces had asked the Defence Ministry for Rs 582 billion in the defence budget, and the ministry had forwarded a proposed allocation of Rs 524 billion to the Finance Ministry, which had limited it to Rs 495 billion for the next fiscal year 2011-12. Later, Fauzia Wahab told reporters that the committee had decided that the defence budget would be curtailed to three percent of the GDP.
The proposed allocation of Rs 524 billion was 2.5 percent of the GDP, while the actual demand of Rs 582 billion was nearer to three percent of the GDP. She said all exemptions to entities controlled by the armed forces had been withdrawn and in future only parliament could approve any exemptions. However, she said that military research was not getting the required funding from the government and this area would be looked at further for financing. The committee, she said, was told that Pakistan had incurred expenditures of $12 billion during the last 10 years under the Coalition Support Fund.
The US had reimbursed $8.64 billion to Pakistan, while arrears of $3.36 billion were still outstanding. No payments to Pakistan had been made during the current calendar year, she said. She said the finance minister had expressed the hope two weeks ago that Pakistan would get $600 million before the end of the current fiscal year on June 30. The committee was told that the government had not released the $1.5 billion allocated to the Armed Forces Development Plan (AFDP) during the current fiscal year.
It was also told that Pakistan had received $300 million under the Foreign Military Financing facility. Foreign Secretary Salman Bashir briefed the committee on the budget demands of his ministry. According to a copy of the presentation, the Foreign Affairs Ministry told the committee that its budget allocation for the next fiscal year had been increased by 6.48 percent to Rs 12.27 billion, as compared to Rs 11.52 billion for the current fiscal year. Fauzia said that the committee unanimously supported the demand of the Foreign Affairs Ministry to increase their operational budget by 40 percent for the next fiscal year.
She said that because of financial constraints, foreign missions could not perform their tasks for improvement in relations in trade, culture and other sectors with friendly countries. “More allocation will allow foreign missions to perform their duties in a better manner,” she said. Committee members also asked the Foreign Affairs Ministry to set up trade and culture wings in embassies on the pattern of the defence wing. They also wanted diplomatic missions in African and Latin American countries, said Fauzia. She said the allocation to the Foreign Affairs Division headquarters had been increased by 14.5 percent to Rs 751.8 million for the next fiscal, as compared to Rs 656 million during the current fiscal year.
For the 117 foreign missions, increase of 5.1 percent had been made with an allocation of Rs 9.2 billion, as compared to Rs 8.8 billion in the current fiscal year. Other expenditures relating to the president, prime minister and other delegations’ visits abroad had been increased by 7.1 percent to Rs 2.03 billion for the next fiscal year, as compared to Rs 1.9 billion during the current fiscal year, she said. The capital outlay for the next fiscal year was increased by 42 percent to Rs 200 million, as compared to Rs 140.8 million for the current fiscal year. Online news agency said Bashir told reporters after the meeting that Pakistan would convey to the US its point of view and national stance that would emerge from the joint session of parliament.
He declined comment on whether Pakistan would lodge a strong formal protest with the US over its unilateral action in Abbottabad.
