- Budget balance records discrepancy of Rs0.43tr.
- Country’s fiscal accounts remain irreconcilable.
- Budget deficit amounts to 1.2% of Pakistan’s GDP.
ISLAMABAD: Pakistan’s overall budget has turned from a surplus into a deficit of Rs1.54 trillion, amounting to 1.2% of the gross domestic product (GDP), with a statistical discrepancy of Rs0.43 trillion, The News reported on Saturday.
The country’s overall fiscal balance turned from an overall surplus in the first quarter (July-September) period into a deficit for the first six months (July-Dec) period of the current fiscal year just ahead of the upcoming International Monetary Fund’s (IMF) full-fledged mission for holding first review talks under the $7 billion Extended Fund Facility (EFF) by the end of February.
In the first quarter, the fiscal side posted a surplus mainly because of profits of the State Bank of Pakistan (SBP) as lump sum payment turned a deficit into a surplus.
The IMF’s visiting Scope Mission has already been holding parleys with the Federal Bureau of Revenue (FBR) authorities for undertaking spadework to set the stage for holding review talks probably by the end of the ongoing month here in Islamabad under the IMF’s Mission Chief Nathan Porter.
The statistical discrepancy means that the fiscal accounts remained irreconcilable, so total revenues and expenditures could not be fully matched. The federal government’s statistical discrepancy stood at Rs0.23 trillion.
Among the provinces, Punjab’s statistical discrepancy remained the largest and stood at Rs0.198 trillion, Sindh’s Rs0.22 trillion, Khyber Pakhtunkhwa’s Rs0.34 trillion and Balochistan’s discrepancy remained negative Rs0.53 trillion.
However, under the IMF programme, the primary balance remained surplus to Rs3.6 trillion in the first half (July-Dec) period of the current financial year 2024-25
According to the fiscal operation of the Ministry of Finance on Friday, debt servicing and defence spending remained the largest ticket item.
In contrast, development especially in the shape of the federal Public Sector Development Programme (PSDP) remained the major victim and its utilisation stood at only Rs0.132 trillion in the first half of the current fiscal year.
The PSDP utilisation stood at Rs0.22 trillion in the first three months of the CFY. On the other hand, the provinces utilized Rs0.639 trillion on development in the first six months of the current fiscal year.
The debt servicing consumed Rs5.14 trillion in the first six months and after witnessing six consecutive reductions in policy rate, now the Ministry of Finance has reduced the projection of debt servicing from Rs9.7 trillion to Rs8.7 trillion for the whole financial year ending on June 30, 2025.
Total fetched revenues of the country stood at Rs9.76 trillion through tax revenues of Rs6 trillion and non-tax revenues of Rs3.69 trillion in the first half of CFY.
The total booked expenditures stood at Rs11.3 trillion out of which markup payment in the shape of debt servicing was the largest expenditure head and stood at Rs5.14 trillion and defence spending stood at the second largest ticket item with the figure of Rs0.89 trillion.
The provision of subsidies payment ballooned and stood at Rs0.237 trillion in the first six months of CFY and it stood at Rs0.2 trillion in the first three months period.
The statistical discrepancy stood at Rs0.439 trillion. The budget deficit of Rs1.5 trillion was financed through external and domestic borrowing of negative Rs0.78 trillion and Rs1.61 trillion respectively.
The FBR’s tax collection fetched revenues of Rs5.62 trillion while non-tax revenues collected Rs3.69 trillion. Out of total non-tax revenues, the petroleum levy collected Rs0.549 trillion in the first six months of the current fiscal year.
