The government has set the size of next fiscal year’s consolidated budget at Rs 3.85 trillion, as compared to Rs 3.39 trillion for the current fiscal, with the federal budget set at Rs 2.54 trillion and provincial budgets at Rs 1.30 trillion, an official source told Pakistan Today on Tuesday.
The revenue target for the Federal Board of Revenue (FBR) is projected at Rs 1.952 trillion and non-tax revenue at Rs 637 billion. This year’s FBR tax revenue target was revised to Rs 1.588 trillion. The Public Sector Development Programme would be of Rs 280 billion. This year, provinces will be transferred Rs 1.050 trillion as compared to Rs 715 billion transferred last fiscal year.
During the next fiscal year, the provinces will be transferred around Rs 1.275 trillion. The government would shell out Rs 790 billion in interest payments during the next the next fiscal year, as compared to Rs 730 billion in interests during the current fiscal year. The allocation for the federal government is Rs 1.513 trillion, Rs 495 billion for defence, and Rs 35 billion for flood relief for the next fiscal.
An official source said the government had calculated the exchange rate parity between $1 to Rs 88 for the foreign financing billion during the next fiscal year. He said various scenarios were thoroughly discussed for the calculation of the exchange rates and finally it was decided that the exchange rate parity should be calculated at Rs 88. The calculation was quite difficult, considering the repayment to the International Monetary Fund from October this year and the rising fuel and commodity prices.
However, it was felt that the country could manage the shock, he said. About the small size of the estimated foreign financing, he said that it was kept on the lower side at Rs 180 billion as during the last three years, Pakistan had not managed to garner enough budgetary support from donors. “We have kept it at a realistic level so that there would be no false hopes,” he added.
In the current financial year, Pakistan had anticipated $3 billion from the Friends of Democratic Pakistan and $1.5 billion under the Kerry-Lugar-Berman Bill from the US. It got paltry amounts from both and the devastating floods forced the government to slash the development budget by Rs 100 billion to provide relief to flood victims.
The exchange rate was expected to remain stable in the next fiscal year, as appropriate measures would be kept in place to restrain speculators even though there would be heavy quarterly payments to the IMF. The government is also hopeful of getting another bailout package from the IMF during the repayment period, the source said. The boom in exports and rise in remittances would provide the necessary cushion to maintain solid foreign exchange reserves, he said.
In recent months, Pakistan’s exports have jumped to over $2 billion from the usual $1 billion per month, while remittances have increased to over $1 billion from an average of $700 million. This has helped maintain foreign exchange reserves of over $17 billion during the last few months.
Rs 3.85tr budget set for next fiscal
