KARACHI – Surging government budgetary borrowing and a consequent swell in inflation has increased financial woes of the poverty-stricken masses. According to provisional data revealed by the State Bank of Pakistan, government borrowing from banks stood at Rs 394.348 billion in the first seven months of financial year 2010-11 compared to Rs 243.876 billion in the last corresponding period, exhibiting a 61.7 percent rise.
Ever-increasing bank loans to the risk-free government sector, primarily to cater the latter’s budgetary needs, appear to have crowded out the non-government sector as banks’ lending to the non-government has undergone a slump of 5.38 percent in July-Feb FY11. Though the private sector loans have shown a 60 percent growth, standing at Rs 157.556 billion against Rs 98.588 billion of last year
