4pc of GDP: Budget deficit under PTI govt rises

ISLAMABAD: Pakistan’s overall budget deficit rose to Rs2.56 trillion or four percent of GDP during the nine months of the current fiscal under the Pakistan Tehreek-e-Insaf led government.

According to the Ministry of Finance, the federal budget deficit ballooned to Rs3.1 trillion in the first nine months of the current fiscal year. But the provincial contribution of Rs0.6 trillion revenue surplus curtailed the overall deficit at Rs2.56 trillion.

Also Read: World Bank raises Pakistan’s GDP growth rate by 1%

Primary balance, which is calculate excluding mark-up payment. Also considered sacrosanct by the International Monetary Fund, stood at Rs0.447 trillion in the nine months period. Earlier, the government had envisaged a surplus primary balance to the tune of Rs0.25 trillion for the whole fiscal year. However, it estimated that it might rise to Rs1.3 trillion by the end of June 2022.

Fears expressed by the federal government that the overall budget deficit might escalate to Rs5.6 trillion till end June 2022 mainly. Because of unfunded subsidies, off book expenditures and inability of the provinces to generate desired revenue surplus. Also FBR’s expected shortfall and overrun in expenditures mainly because of increased debt servicing.

The overall budget deficit stood at Rs1.65 trillion or 3.6 percent of GDP in the same period of the last year. With the rebasing of national accounts, Pakistan’s GDP size has estimated at Rs63.978 trillion for the current fiscal year.

This also raised the overall budget deficit to Rs2.56 trillion in the 9MFY22 against Rs1.65 trillion. So, the budget deficit in absolute figures went up by over Rs0.9 trillion in the ongoing fiscal year.