KARACHI
According to the State Bank of Pakistan in its latest report, it has been claimed that the government borrowed over Rs300 billion in the last month of 2014-2015 for budgetary support from the banking sector that may have lead to breaching of the fiscal deficit target projected at 5 percent of GDP for the year.
State Bank of Pakistan further added that the government borrowed heavily after announcing the budget for 2015-16 on June 5 to meet its expenditure commitments.
The SBP reported that during the last fiscal year up to June 26, 2015 the government borrowed Rs980.7bn for budgetary support — Rs679.7bn in first 11 months and Rs301bn (31 per cent of the total borrowing in the entire fiscal year) in June alone.
In 2013-14, it borrowed just Rs302bn for budgetary support.
All major budgetary targets for the FY15 were missed, but the government succeeded to satisfy IMF and received tranches under the stand-by loan programme.
The government has announced to borrow Rs1.35 trillion in the first quarter of this fiscal year suggesting there is no change in its economic management largely depending on borrowing from domestic as well as foreign sources.
The revenue target for 2015-16 was projected at Rs3.1 trillion, which seems unlikely to be met as the Federal Board of Revenue (FBR) has failed to achieve the outgoing fiscal year’s revenue collection target of Rs2.605tr, which was already revised thrice, and collected Rs2.580tr, a shortfall of Rs25bn, according to the report.
