Pakistan govt’s fiscal deficit expected to narrow in FY24: Report

Islamabad [Pakistan], July 26 : The Pakistan government’s fiscal deficit is expected to narrow in the fiscal year 2024 from the previous year’s 7.9 per cent of gross domestic product, the federal government said in an economic report on Wednesday, Dawn reported.
Dawn is a Pakistani English-language newspaper.
The report attributed the reason “largely due to a 12 per cent reduction in non-markup spending”.
The report read: “With a decline in non-mark-up spending, the primary deficit has been narrowed down to Rs 112 billion during Jul-May FY23 from Rs 945.3 billion recorded last year.”
The Pakistan government also said that the current account deficit would remain within a sustainable limit and that Pakistan was gearing towards achieving “higher growth” of 3.5 per cent in FY24 due to various measures such as the agriculture package, industrial support, export promotion, encouragement of the IT sector and resource mobilisation, etc.
The report read: “To achieve higher and sustainable economic growth, it will require prudent and effective economic decisions, political and economic certainty, and continuation of friendly economic policies along with enough foreign exchange financing.”
The government had earlier estimated the 2024 fiscal deficit at 6.54 per cent in its annual budget presented in June, which according to Finance Minister Ishaq Dar could further improve after new taxation of Rs 215 billion, ahead of the country clinching a USD 3 billion IMF deal.
Wednesday’s report said annual inflation had declined to 29.4 per cent in June down from 38 per cent recorded in May.
The IMF deal helped avert a near-default by Pakistan on its foreign debt due to an acute balance of payment crisis, as per Dawn.