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Saturday, May 25, 2024

PTI Govt to present its second budget with total outlay of Rs 7.4 trillion

It consists of Annual Development Program (ADP) of Rs 1324 billion with 12 percent reduction in the current fiscal year ADP of Rs 1500 billion. Know here what's in the budget for you.

PTI government will present its second annual budget for the fiscal year 2020-21 in the National Assembly (NA) for approval today (Friday) with total outlay of about Rs 7.4  trillion.

Tax recovery target is likely to be projected at Rs 4.95 trillion. Work is underway to raise pension and salaries of the government employees from 5 to 10 percent.

National Economic Council (NEC) under the Prime Minister (PM) Imran Khan has approved Annual Development Program (ADP) of Rs 1324 billion with 12 percent reduction in the current fiscal year ADP of Rs 1500 billion.

The federal development program has been projected Rs 650 billion with the reduction of 7.3 percent of the current fiscal year development program of Rs 701 billion while provinces development program has been proposed Rs 674 billion with reduction of 16 percent. Special projects of Rs 70 billion for containment of coronavirus are also part of this program.

Read more: Fiscal budget 2020-21: The best way forward

Punjab development project has been projected as Rs 337 billion for the next fiscal year against the development budget of Rs 350 for the current year. Sindh has allocated Rs 165 billion for development schemes with 41 percent curtailment in the development budget of current year that is Rs 279 billion.

KP has earmarked Rs 100 billion with the reduction of 58  percent in the current year development budget of Rs 236 billion, Balochistan has allocated Rs 756 billion with the curtailment of 31 percent in the current year of Rs 109 billion. No change has been made in the development budget of Azad Kashmir and Gilgit-Baltistan that is Rs 24.5 billion and Rs 15 billion respectively.

The GDP growth rate target has been projected at 2.1 percent for the next financial year.  During the current year GDP growth rate has remained minus 4 percent against the targeted GDP growth rate of 3 percent.

Agriculture sector target is projected at 2.8 percent, industrial sector at 0.1 percent and service sector target at 2.6 percent.

Sources said proposal has come for projecting trade deficit target at 7.1 percent and current account deficit target at 1.6 percent. Fiscal deficit budget is proposed to be restricted at 7 percent. The inflation is estimated to be reduced from 11 percent to 6.5 percent.

The defense budget is proposed to scale up to Rs 1400 billion from Rs 1250 billion with increase of 12 percent in the next financial year.

Allocation of over Rs 3.22 trillion is proposed for repayment of debt in the next fiscal year.

Sources said non-development expenditures are proposed to be curtailed and subsidy to be made more targeted in the next fiscal year budget. Expenditures to the tune of Rs 1200 billion are likely to be incurred during the current year owing to resource constraints. The development funds are proposed to be reduced for several departments.

Read more: Covid-19 Impact on Global Economy & Role for Global Financial Institutions

Sources said Rs260 billion are proposed to be allocated for subsidy and Rs 475 billion for pension.

Different proposals are consideration for raising pension and salaries of government employees. However, these proposals will be put up in the cabinet meeting and Prime Minister will take final decision in this regard.