According to a recently published report on Pakistan by International Monetary Fund (IMF), Pakistan’s general government debt (including guarantees & IMF borrowing) during the first quarter of current fiscal year, showed significant decline as it fell to 84.7 percent of Gross Domestic Product (GDP), however by the end of previous year, the country’s debt had risen to 88 percent of GDP.
According to report, this decline in debts was mainly driven by Pakistan government’s smart performance in reducing expenditures, registering primary budget surplus and increasing tax and non-tax revenues during the first five months of current fiscal year.
“In the first quarter of current fiscal year (2019-20), budget execution by the incumbent government improved considerably, and the general government budget registered a primary surplus of 0.6 percent of GDP and an overall deficit of 0.6 percent of GDP, about 1 percent of GDP better than programmed,” the report added.
The report observed that in FY 2019, the general government budget registered a primary deficit of 3.5 percent of GDP and an overall deficit of 8.9 percent of GDP, against its target of 1.8 and 7 percent, respectively.
Revenue collection at the federal level came in 2 percent of GDP, lower than expected, while total expenditures and provincial fiscal balances were in line with projections, it added. Around three fourth of the revenue shortfall were due to one-off factors, which are not expected to carry over into FY 2020.
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