PKR 7Tn ‘tough’ budget

The govt. has presented its first annual budget with a record outlay of PKR 7,036Bn for FY20, which is 30% higher than budget FY19.The proposed budget carries the highest-ever deficit of PKR 3,150Bn (7.2% of GDP) despite introducing massive additional revenue generation measures (worth PKR 512Bn) and reduction in expenditure. Among major expenditures, the govt. has allocated PKR 2,890Bn for interest payment, PKR 421Bn for pensions, PKR 1,150Bn for defense, PKR 271.5Bn for paying subsidies and PKR 431.2Bn on running civil govt. The federal PSDP would consume PKR 701Bn. In revenues, the tax collection target for FBR is PKR 5,555Bn while non-tax collection target is PKR 894.5Bn. Privatization proceeds would generate PKR 150Bn.