ECC Clears Rs380bn Grants for Dams, Defence and Fertiliser Gas
Photo: State media via The News (file photo of the Diamer-Bhasha Dam site)
The government's economic committee has cleared about Rs380 billion in extra grants in one sitting. Most of it, Rs275 billion, goes to five water projects that were running short of cash, and about Rs84 billion goes to the armed forces. The decisions were taken on Wednesday by the Economic Coordination Committee, chaired by Finance Minister Muhammad Aurangzeb.
The water money is the biggest single item, and it tells a story of its own. The five projects are the Diamer-Bhasha Dam, the Mohmand Dam, the Greater Karachi Water Supply scheme known as K-IV, the Chashma Right Bank Canal and the Kacchi Canal. The money will be released in stages, in line with Wapda's payment plan, as Dawn reported.
Why did projects of this size need extra cash mid-year? The budget for 2026-27 had set aside only about Rs103 billion for them, and Wapda had been telling parliament that the money was not enough to keep work moving. Wapda's chairman had said his requests for more funds were approved by the prime minister and the finance ministry, and the ECC decision now puts that approval into numbers.
For people in Karachi, the K-IV share matters most, since that scheme is meant to bring more water to a city that has waited years for it. For farmers, the canals and the two dams matter for irrigation and for power in the years ahead. Diamer-Bhasha alone is planned to store 8.1 million acre feet of water and generate 4,500 megawatts of power.
The defence side of the package adds up to about Rs84 billion across three summaries. That includes Rs54 billion for ongoing defence services projects, of which more than Rs31 billion is for the Special Security Divisions in the north and south, Rs11.88 billion for Pakistan Navy projects and Rs10 billion for internal security duties and allowances.
On top of that, the committee approved Rs1.094 billion to bring a Lineage L-1000 executive jet into the army fleet, and Rs29.139 billion for Project Istaqlal. The official statement said the approvals were aimed at meeting essential operational needs and supporting national security priorities, as Business Recorder reported.
The rest of the meeting covered a long list of smaller items that still touch daily life. Gas supply to two Punjab fertiliser plants, Fatima and Agritech, will continue until 31 December, subject to availability, which matters for fertiliser supply and farm costs. The committee also moved Rs15.625 billion saved through austerity and fuel conservation into the Prime Minister's Austerity Fund 2026.
Other decisions included revised tiers and bank rates for the Prime Minister's Youth Business and Agriculture Loan Scheme, restrictions on importing camera-enabled smart glasses, with a recommendation that provinces draw up workplace rules for such devices, and easier rules for extending and renewing 89 petroleum exploration rights. Villages within five kilometres of gas fields will get Rs1 billion for gas connections during this fiscal year, and Rs3.71 million was approved for helicopter maintenance for Frontier Corps Balochistan (North).
The scale of the grants shows how tight the budget has become. The federal government had already taken about Rs1.035 trillion in extra funds from the four provinces outside the National Finance Commission in June to meet strategic needs, including water and national security. Supplementary grants like these are how the government plugs gaps when the original budget falls short.
PakInsight Hub has followed Pakistan's economy closely this week, including Saudi Arabia rolling over Pakistan's $3bn loan as the US $10bn facility fades, petrol falling to Rs362 a litre in Pakistan from today and subsidised gas at Rs300 to Rs350 for BISP families under the new LPG policy.
Sources
What happens next: Wapda will now draw the water money in stages under its payment plan, and the next ECC meeting will show whether the grants ease the projects' cash crunch.
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