Pakistan to miss budget deficit goal

A new International Monetary Fund report showed that Pakistan is set to miss this fiscal year’s budget deficit target by approximately Rs1 trillion, as the global lender anticipates the country’s increased reliance on loans in the coming years. The IMF released the report from Washington on the same day Pakistan’s finance minister sought assistance from the United States for “debt financing”. The Fiscal Monitor report of the IMF indicated that the gap between expenditure and revenues may remain at 7.4% of the Gross Domestic Product (GDP) for the fiscal year 2023-24 ending in June. This figure is nearly Rs1 trillion or 1% of the GDP higher than the deficit limit approved by the National Assembly. Despite the successful completion of the $3 billion IMF programme, the government is expected to miss the budget deficit target. Last year, the IMF forced Pakistan to amend the budget after its presentation in the National Assembly to make it more realistic. Yet, the target of 6.5% of the GDP or Rs6.8 trillion is projected to be missed by Rs1 trillion, necessitating additional borrowings from banks.