Pakistan's economy in disarray as income-expense gap widens to Rs 1.8 trillion: Report

In a major jolt for the Imran Khan-led Pakistan government, a new report stated that Pakistan's federal budget deficit in the first half of the current fiscal year shot up to Rs 1.8 trillion. According to a report by the Express Tribune, the country registered a federal budget deficit jump of 29% compared to the same period of the previous year. The budget deficit, that is the gap between federal income and expenditures were provisionally recorded at Rs 1.8 trillion, or 3.3% of Pakistan's gross domestic product (GDP), for July-December of the ongoing fiscal year, as per Express Tribune.

Further, the report said that the country's annual federal budget deficit target is Rs 4 trillion for the current fiscal year. Citing the reason behind the major gap in spending and revenue generation, the report said that the country spends a heavy amount of money in the last quarter of every fiscal year. Another major reason behind the surge in the deficit was the uptick in current expenditures, hence, the government spent a lower amount under the Public Sector Development Programme to meet a condition of the International Monetary Fund (IMF) loan programme, according to Express Tribune.

"Current expenditures were equal to 92% of the total federal government expenditures and 40% of them were spent only on paying interest on loans," the report said.

"Federal development spending stood at only Rs 274 billion in the first half of the current fiscal year, which was higher than the comparative period of the previous year but constituted only 30% of the annual budget of Rs 900 billion," added the report.

'Pakistan is bankrupt, better to recognise reality'

Earlier in December last year, revealing the current situation of Pakistan, former chairman of Pakistan's Federal Board of Revenue Shabbar Zaidi said that the country is bankrupt and asked the countrymen to accept the reality. While addressing a seminar at Hamdard University in Karachi, Zaidi highlighted the current situation of Pakistan and said, "It is better to recognise the reality than living in an illusion." "They say we have achieved great success and we brought tabdeeli (change), but this is wrong. In my view, the country is, at the moment, bankrupt,'' Zaidi said. "It is better if you decide first that we have reached bankruptcy and we have to move forward compared to saying everything is running well and I will do this and that. These are all things to deceive the people," added Zaidi.

Image: ANI/AP