ISLAMABAD – The federal government has revoked the authority of PDWPs to approve projects funded entirely by provincial resources without federal or foreign funding.
Earlier, the National Economic Council (NEC) had decided that provincial projects with no federal grants, loans, or foreign funding would not require approval from the Central Development Working Party (CDWP) or the Executive Committee of the NEC (ECNEC). The sanctioning limit for PDWPs was set at Rs 10 billion, while projects above this limit were forwarded to the CDWP for review.
In June 2025, during the review of the Federal Public Sector Development Programme (PSDP) 2024-25 and proposed PSDP FY2025-26, NEC emphasized that projects funded solely by provincial resources could be approved independently by PDWPs. This aimed to streamline project approvals and reduce bureaucratic delays.
The Ministry of Planning, Development & Special Initiatives (MoPD&SI) circulated the NEC directive on August 13, 2025. However, less than two weeks later, the federal minister for planning reversed the decision. On August 25, 2025, a formal notification was issued, withdrawing the earlier circular and instructing that any actions taken under it be reverted.
An official source explained that the federal government wants to maintain oversight during the approval stage of provincially funded projects. As a result, PDWPs no longer have the autonomy to sanction projects without federal consultation.
This move underscores the central government’s intent to remain involved in provincial project approvals, even when no federal or foreign funding is used. The reversal may affect the speed and efficiency of provincial development initiatives, as projects now require federal review before execution.
The debate over the powers of PDWPs highlights ongoing discussions about provincial autonomy and federal oversight in Pakistan’s development planning.
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