Manual for Development Projects - Planning Commission

Chapter-1
a realistic statement of the goals to be achieved. It gives a sense of direction to the current
economic policies. It establishes targets of massive improvement to be brought about in living
standards by mobilizing the resources and energies of the nation".
1.30 The period is necessarily arbitrary and there is no profound reason for its determination
but it seems to be, on the one hand, long enough to permit a meaningful structural change in the
economy and, on the other, not so long as to be without direct interest to the present working
generation. More specifically, five year plans are inadequate as a framework for targets and
policies for other reasons. Many short term decisions have a bearing on long-term growth. If
these decisions are taken without considering their implications for the years beyond the current
five year plan, there is a danger of unexpected future imbalances. Economic growth is a
continuous process so that planning for it calls for the integration and adjustment of short-term,
intermediate and long-term programmes.
1.31 The seventh five year plan puts the perspective plan in the following words:
"Social change is a complex long-term process. It involves changes in values and ideas in
social, political and economic spheres and innovations in the utilization of natural resources. It
is useful to look from time to time at economic development in its wider context, and to prepare
long term plans, more by way of setting distant guideposts than as a real effort to achieve
specific targets. Obviously, given the uncertainties attaching to even nearer-term projections, a
perspective plan cannot be a specific blueprint for action. The second perspective plan has been
developed to visualize the desired profile of Pakistan in the year 2003, and outline a broad
approach to key problems which may arise".
Public Sector Development Programme (PSDP)
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1.32 The Public Sector Development Programme (PSDP) is an annual document which lists all
the public sector projects/ programmes with specific allocations made for each one of them in
that particular financial year. It is the operational side of the Five Year and Annual Plans. In
other words, it is that part of the country's annual budget which deals with development
expenditure, that is, it indicates the total cost of the project, foreign exchange component of the
total cost, expenditure incurred upto the end of last financial year, PSDP allocation for the
current financial year together with its foreign aid component.
1.33 The PSDP procedure differs from the project approval procedure. Due to the general
constraint which exists on government funds, projects are competing for a limited amount of
funds available for development. An essential part of the procedure, therefore, is a shift from
the examination of a project in isolation to the selection of a limited number of projects out of a
much larger portfolio.
1.34 The preparation of the PSDP is co-ordinated by the Programming Section of the Planning
and Development Division. The procedure is laid down in detail in a PSDP call letter sent
annually to all Government Ministries/Divisions, Provincial Governments and Chiefs/Heads of
Technical Sections of the Planning and Development Division. The call letter includes a timeschedule
and a standard proforma alongwith guidelines on the preparation of the PSDP and
selection of projects. The procedure starts in October/November each year. A copy of the letter
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9/23/2010