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Wolesi Jirga okays budget after rejecting twice

Wolesi Jirga okays budget after rejecting twice

Apr 21, 2012 - 13:20

KABULinfo-icon (PANinfo-icon): A majority of parliamentarians on Saturday approved the proposed budget for the current fiscal year, after it was rejected twice due to inequalities in the provincial allocations.

Previously, the Wolesi Jirgainfo-icon refused to endorse the accounts due to uneven allocations to provinces and a hefty bill of $80 million (3.9 billion afs) bailout package for the cash-strapped Kabul Bank.

Of the 135 legislators present at Saturday’s session, 111 voted in favour of the budget. While 24 other MPs were against it.

According to ministry officials, the general budget for the current nine months of this year is 133.6 billion afs, while the development fund amounts to 111.2 billion afs.

Kabul Bank, the country’s largest private lender, was taken over by the government when it was at the verge of collapse two years ago due to issuing unauthorised loans to its owners.

The bank was renamed New Kabul Bank after the government’s takeover and there plans to privatise it later this year.
According to the central bank, Da Afghanistaninfo-icon Bank, nearly $850 million were withdrawn in December from the bank as off-book loans.

So far, $750 million loans obtained by shareholders had been recovered, about $70 million in cash and another $50 million worth of properties in Dubai.

Earlier this month, the government gave borrowers two months to return the loans to the troubled bank.

The decision came at a high-level meeting chaired by President Hamid Karzai.

On November 30, Da Afghanistan Bank Governor Noorullah Delawari, said the near collapse of Kabul Bank was due to non-implementation of banking laws.

So far, $74 million worth of loans obtained by shareholders had been recovered and another $400 million were expected to be repaid in the near future, according to Dilawari.

"As of now, 80 percent of Kabul Bank loans are accounted for, with 20 percent loans yet to be identified," Delawari said, adding an investigation was underway to identify unknown credit beneficiaries.

Properties purchased with the bank’s loans in Dubai, include 17 residential houses and two high-rise buildings, says First Deputy Governor of Da Afghanistan Bank Mohibullah Sapi.

However, the Wolesi Jirga’s finance and budget commission head, Amir Khan Yar said id="mce_marker"5 million from the $80 million bailout package had been reallocated to a mega road project -- which would connect central Bamyan province with western Herat.

He also said another 50 million afghanis from the package had been given to the Haj and Auqaf Ministry by Karzai.

A majority of lawmakers said no money should be given to Kabul Bank and also suggested a cut in budget for the president.

But the finance minister said if Kabul Bank was not rescued, the International Monetary Fund (IMF) would not release funds to Afghanistan.

Hazrat Omar Zakhilwal said a big portion of foreign assistance to Afghanistan came from IMF.

He said funds to the president were provided from that assistance, which had nothing to do with the parliament.

“I cannot understand why lawmakers have problem with presidential budget this time,” he asked.

According to Amir Khan Yar, in the first draft budget, the president was allocated $84 million, but the amount was reduced to $76 million in the third draft.

Zakhilwal said id="mce_marker"3 million of the president’s budget was under the Code 91, under which the president provided financial aid to poor families and war-affected people.

“One month has already been lost and procurement of funds will take another two months to complete. I request you to approve the budget which will be implemented over six months only,” he told lawmakers.

He warned if the budget was once again rejected, all development projects would stop.

Speaker Abdul Rauf Ibrahimi said the budget did not belong to him or Zakhilwal or the president, it was national budget which needed to be approved.



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