Refinery at Reko-Diq Balochistan chalks out investment plan

Posted on June 23, 2011. Filed under: Fossil fuels, Pakistan |

The Balochistan government will invest over Rs20 billion in different sectors through an Investment Board to generate resources for setting up refinery at Reko-Diq Copper-CumGold Project site.

Speaking at a post-budget briefing here on Wednesday, Provincial Finance Minister Mir Asim Kurd and Secretary Finance Dostain Jamaldini said that for the purpose an amount of Rs8.5 billion had been set aside in the next provincial budget.

They however said that a sum of Rs12 billion which was earmarked in the current fiscal year could not be invested as the governing body, which includes noted scientist Dr Samar Mubarakmand, was preparing the feasibility report for the installation of refinery.

The finance minister said that the Investment Board headed by the chief minister had already been set up to decide the utilisation of funds. Mirza Qamar Baig, a former bureaucrat, was vice-chairman of the board. Replying to a question, Kurd said that the provincial government intended to run the Reko-Diq Copper-Cum-Gold Project. However, he said, no decision has so far been taken about giving mining licence to any company. “We will take final decision about awarding mining rights according to the Mines Act,” he informed. He also said that the provincial government wanted to purchase 25 per cent shares of Pakistan Petroleum Limited.

“The Investment Board would also consider other sectors for the investment to generate resources for establishing the proposed refinery,” Secretary Finance Dostain Jamaldini told a questioner.

Mr Kurd said that the feasibility report of Reko-Diq project had been finalised. “We have allocated Rs8.5 billion in the next fiscal year budget on the recommendation of the Dr Samar,” he disclosed.

He said that with functioning of the proposed refinery, the Balochistan government would be earning Rs58 billion in annual incomes and it was the main reason that no mining licence to any foreign company had been issued.

The finance minister said that the Balochistan government would sign an agreement for exploring and mining at Saindak Copper and Gold project with any investor on the condition of 50 per cent share in the total income.

Referring to the Public Sector Development Programme (PSDP) for the year 2011-12, he said that it was up 9 per cent of the current year’s PSDP that was Rs26.75 billion. He said that provincial government succeeded through its measures to overcome the deficit of around Rs7 billion projected in the current year’s budget.

“We have curtailed our nondevelopment expenditures and generated resources to provide maximum funds for the PSDP,” Mr Kurd said.

He did not agree with a questioner that non-development expenditures were increased manifold and said that there was around 6-34 per cent increase due to the decision of increasing salaries and pensions of the government employees.

Subsidy on agriculture tube-wells was also increased from Rs2 billion to Rs3 billion annually.

Responding to a question, the finance minister said that the federal government had committed to provide Rs7 billion for improving law and order situation in the province but it did not fulfil its promise.

“The federal government has again promised that it will give Rs2 billion in 2011-12 for improving the security situation,” he added.

Mr Jamaldini said that the provincial government would achieve its revenue collection target set for the financial year 2011-12.

“The province could enhance its revenue and income only from mining, fisheries, livestock and agriculture sectors,” he added.

We are far behind from other three provinces in collection of revenue including General Sales Tax (GST), Capital Gain Tax (CGT) and Property Tax, however, we are raising adequate amount from motor vehicle tax and stamp duty,” Jamaldini said.

Replying to a question, the finance minister said that the allocation for the law and order had been reduced. Last year government had earmarked Rs12.5 billion for this purpose while in the 2011-12 budget allocation for law and order would be Rs11.5 billion.

He said that 90 per cent funds of the Public Sector Development Programme for the current fiscal year had been utilised.


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