Finance Minister Muhammad Aurangzeb is set to present the 18 trillion rupees federal budget for the financial year 2024-25 in the National Assembly today, which will focus on fiscal consolidation to curb the fiscal deficit, official sources said on Tuesday.
According to sources, the main objectives of the budget will be to alleviate the problems of the people, transform the agriculture sector, promote information technology (IT), boost exports, promote industrial development and boost business.
The budget was formulated keeping in mind the existing challenges facing the economy on the domestic and international front, the sources said, adding that the government was firmly committed to presenting a pro-people, business-friendly and progressive federal budget.
On the revenue side, the sources said, the government was likely to set the revenue collection target at over Rs 12 trillion for FY 2024-25, given the strong revenue growth in the outgoing FY 2023-24.
“The budget is prepared in close coordination between all departments and ministries involved in budget-related events, including the presentation of the budget in parliament a day after the Economic Survey begins,” a source said.
“It will follow policies aimed at fiscal consolidation to contain the fiscal deficit. Besides, revenue mobilisation, economic stabilization, reduction of non-development expenditure, job creation will be the main features of the budget,” the source added.
The budget comes a day after the government said the 2.4 percent economic growth expected this year would miss the 3.5 percent target, although revenue was up 30 percent from last year and fiscal and current deficits were under control.
Pakistan is in talks with the IMF for an estimated $6 billion to $8 billion loan as it seeks to avert a default for the region’s slowest-growing economy.
However, a recent economic upturn following stabilization measures and falling inflation, as well as the central bank’s interest rate cut on Monday, has the government optimistic about growth prospects.
The key policy rate could be cut further this year and economic growth will continue to pick up, Finance Minister Muhammad Aurangzeb, who will present his first budget, told reporters on Tuesday.
Markets will watch the budget for a privatization revenue target as Pakistan tries to pull off its first major sale in nearly two decades by selling a stake in its national airline, kicking off a series of such moves.
Tapping undertaxed sectors such as agriculture and retail for additional revenue would spark protests from farmers and small traders, while spending cuts to discretionary funds for MPs have already strained party alliances and loyalty.
With additional data from Reuters
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