The Budget Deficit for Pakistan has climbed to an astounding Rs 3.403 trillion which is 7.1 % of the Gross Domestic Product (GDP) for the year 2020 – 2021.
The government had predicted the deficit target to be 7 % and independent economists had analyzed the rate to be between 7 and 7.5 % for the previous fiscal year which ended on June 30, 2021. The turnabout of 7.1 %, had the primary deficit totaling Rs. 653.5 billion which is 1.4 % of the GDP.
In the last fiscal year of 2020-2021, the interest payments on national loans and defense spending had the greatest share of all expenditures as compared with other developmental expenses. On the other hand, the revenue return was Rs 6.269 trillion, out of which NFC Award payments to provinces of Rs 2.741 trillion left only Rs 3.5 trillion in net revenues. Which when summed with non-tax revenues of Rs 1.4 trillion, resulted in only possible payments on the markup repayment of debt and defense expenditure.
As per the plan released on Thursday of fiscal operations for 2020-2021, the mark-up payment stayed to be the largest among the expenditures as it consumed Rs 2,749 billion, comprising of payment on the internal debt of Rs 2,523.8 billion and on external credits of Rs 226 billion. Next, the defense expenditure continued to be the next biggest payment as it was given Rs 1,316.48 billion. While during the previous fiscal year the Public Sector Development Program (PSDP), Province development capital, pension outgoings, civil government expenses, subsidies, and grants amounted to Rs 441 billion, Rs 770.2 billion, Rs 440 billion, Rs 505.8 billion, Rs 425 billion, and Rs 823 billion, respectively.
The total revenues generated last fiscal year amounted to Rs 6.93 trillion. This included federal revenues of Rs 5.272 trillion in which FBR accumulated Rs 4.7 trillion and provinces amassed Rs 508 billion of the federal proceeds. Another Rs 1.6 trillion was attained through non-tax revenues which comprised Rs 150.2 billion from provinces and Rs 1.48 trillion from the federal section.
Preceding deficit rates for this government’s regime have been as follows: 7.1 percent in 2020-21, 8.1 percent in 019-20, and 8.9 percent in 2018-19 all of which place on the upper side of the scale.
