IMF sees fiscal deficit exceeding govt target

The International Monetary Fund (IMF) on Wednesday forecast Pakistan’s fiscal deficit — the gap between the country’s total resources and expenditures — for the current financial year at 7.6 per cent of GDP, almost 1.1pc higher than 6.5pc target set by the federal government. Even after taking into account Rs600bn cash surplus targeted by the Centre to come from provincial governments, the IMF estimate is about 0.6pc higher than the government’s budget target. The centre had estimated the overall fiscal deficit for the current year at Rs6.9 trillion (6.5pc of GDP) on the anticipation that provinces would offer Rs600bn surplus to scale down federal deficit, otherwise estimated at Rs7.5tr, or 7.1pc of GDP. As such, the IMF has stuck to its earlier projection made in July for the fiscal deficit on the basis of its agreement with then authorities as part of $3bn Standby Arrangement (SBA) for the nine months ending in March next year.