Spending restrictions

THE consistent contraction in the size of the federal Public Sector Development Programme for the past three years is yet another sign of Pakistan’s lingering financial and economic crisis. New official data shows that the government has squeezed federal infrastructure development to Rs353bn — less than 0.4pc of GDP — during the first 10 months of the ongoing fiscal year to April, as the cash-strapped centre slashes its expenditure to meet the IMF goal of producing a primary budget surplus of 0.4pc of GDP this year. The total spending for the period under review is 38pc of annual PSDP allocations of Rs940bn, and is 12.3pc less than what was spent on development projects during the same period a year before. That the government does not have enough money for new projects, or even for maintaining existing ones, underlines the costs Pakistan’s citizens are forced to pay to survive the country’s worst economic crisis ever. The lingering financial troubles also mean that most of the millions of people affected by the devastating floods of 2022 are still waiting to be rehabilitated. A media report suggests that the IMF wants Pakistan to bring down expenditure by around 163bn to Rs183bn — to make up for a significant revenue shortfall — as the Fund is not willing to make concessions on the goal of achieving a primary budget surplus this year.