The Economic Coordination Committee of the cabinet on Wednesday approved supplementary grants worth about Rs380 billion, including Rs275 billion for five major water projects facing financial constraints and around Rs84 billion for the armed forces. The meeting was chaired by Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb at the Finance Division and considered 11 agenda items, covering a range of spending proposals from different ministries.
The Rs275 billion technical supplementary grant is for water sector projects under the Ministry of Water Resources — Diamer-Bhasha Dam, Mohmand Dam, Greater Karachi Water Supply, known as K-IV, Chashma Right Bank Canal and Kacchi Canal — to be disbursed gradually in line with Wapda’s requirements under its payment plan. The five projects are among the most important water infrastructure schemes in the country, covering large dams, urban water supply and irrigation canals. Their inclusion together in a single grant reflects the scale of the financial constraints they face and the government’s decision to address them as a package.
The government had allocated about Rs103 billion for these water sector projects in the 2026-27 budget, but Wapda had complained of implementation difficulties due to financial constraints. The gap between the budget allocation and the amount now approved is substantial, and it suggests that the original allocation was insufficient to keep the projects moving at the pace required. Wapda, the Water and Power Development Authority, is responsible for implementing the projects, and its complaint about financial constraints prompted the ECC to approve the additional funding.
The amount will be provided out of Rs1,034 billion provided by the provinces to the Centre under Article 164 of the 1973 Constitution. Article 164 concerns the sharing of revenues and the transfer of funds between the provinces and the federal government, and the use of provincial funds for these projects is a notable feature of the arrangement. The disbursement will be gradual, in line with Wapda’s requirements under its payment plan, which means the money will be released as the projects need it rather than in a single lump sum.
The ECC also approved three Defence Division grants: Rs54 billion for ongoing Defence Services projects, Rs1.094 billion for the induction of a Lineage L-1000 aircraft and Rs29.139 billion for Project Istaqlal. Together, those three grants account for around Rs84 billion for the armed forces, covering both ongoing projects and specific acquisitions and programmes. The Lineage L-1000 aircraft and Project Istaqlal are named as distinct items within the defence allocation, alongside the broader funding for Defence Services projects.
The ECC approved a Rs1 billion grant for gasification of villages within a five-kilometre radius of gas production fields during the fiscal year 2026-27. That grant is aimed at extending gas supply to communities living near the fields where gas is produced, a measure that addresses a long-standing grievance of those communities. A Rs3.71 million grant for helicopter maintenance of Frontier Corps Balochistan North was also approved, a smaller but specific allocation for the upkeep of aircraft used by the paramilitary force in Balochistan.
The committee also approved the transfer of Rs15.625 billion in savings from austerity and fuel conservation measures to the Prime Minister’s Austerity Fund 2026. The transfer shows that savings made through measures to reduce spending and conserve fuel are being channelled into a dedicated fund, rather than being absorbed into general expenditure.
The ECC’s decisions, taken across 11 agenda items, illustrate the breadth of the committee’s role in approving supplementary spending. The water projects and defence grants dominate the total, but the smaller grants for village gasification, helicopter maintenance and the austerity fund show that the committee also deals with a range of other proposals. The gradual disbursement of the water grant, tied to Wapda’s payment plan, will be watched as the projects proceed.
Source: Dawn, The News.
