Budget deficit jumps to Rs 276.1b in first quarter

ISLAMABAD: The consolidated budget deficit increased to Rs 276.1 billion or 1.6 percent of the gross domestic product (GDP) during the first quarter of the current fiscal year.
According to the Fiscal Operations Report for July-September 2010-11 released by the Ministry of Finance on Tuesday, the budgetary target for deficit projected at 4 percent of the GDP, which was revised upwards to 4.7 percent due to additional expenditure incurred on flood relief.
During the first quarter, the total revenue collection was recorded at Rs 400.1 billion or 2.3 percent of the GDP whereas the expenditure amounted to Rs 676.3 billion resulting in a budget deficit of Rs 276.1 billion. The revenue collection included the federal and provincial tax revenues of Rs 317 billion in which the federal taxes generated Rs 302.8 billion and the provincial governments collected Rs14.3 billion.
The non-tax revenues amounted to Rs 82.8 billion during the first quarter, including Rs 74.1 billion federal non-tax revenue and Rs 8.6 billion provincial non-tax revenues. It includes Rs 5 billion collected through development surcharge on gas, Rs 2.9 billion through discount retained on crude oil and Rs 19.5 billion from royalty on oil and gas.
The expenditure data discloses that the total consolidated expenditure was Rs 676.3 billion or 4 percent of the GDP in the first quarter of the current fiscal year. The non-development expenditure is estimated at Rs 566.7 billion. The government spent Rs 161.5 billion on interest payments and Rs 93.1 billion as defense expenditure.
The development expenditure and net lending amounted to Rs 62.7 billion, federal development expenditure Rs 43.1 billion, provincial development expenditures Rs 27.2 billion. The federal government spent Rs 146.6 billion on domestic debt servicing and an amount of Rs14.9 billion was spent on external debt servicing.
The financing of the total budget deficit Rs 276.1 billion was managed through Rs 56.8 billion external borrowing and Rs 219.3 billion from local borrowing. Local borrowing included Rs 120.9 billion as bank borrowing, Rs 98.3 billion as non-bank borrowing.