Issue 56

Budget Study Centre   Issue 56
Dec 26, 2019


Fortnightly Budget News Alerts

Mini-budget coming?

The News (Dec 26, 2019)

According to the Memorandum of Economic and Financial Policies (MEFP), there are at least two points that indicate a likely revision in budget targets anticipating a dreaded mini-budget in the next couple of months. Dreaded because the public is already under tremendous pressure of inflationary trends ever since the PTI government came to power in 2018. Despite repeated claims and promises… Read More

IMF assumes far less-than-expected rupee fall

The Express Tribune (Dec 26, 2019)

ISLAMABAD: New assumptions by the International Monetary Fund (IMF) suggest that the average exchange rate at the end of this fiscal year could be Rs160.64 to a dollar, which is significantly lower than the steep depreciation the global lender had predicted while designing the $6-billion loan programme. The fresh valuation is 6.9% or Rs11.9 less… Read More

IMF’s new conditionalities: Mini-budget on the cards

The News by Mehtab Haider (Dec 25, 2019)

ISLAMABAD: After revising downward the FBR’s target from Rs5.5 trillion to Rs5.238 trillion, Pakistan has agreed under the new structural benchmark condition with the IMF to take ‘additional measures’ on the eve of presenting the budget review before parliament by end of February 2020. This indicates that a mini-budget is on the cards if the need arises to achieve the envisaged annual targets for … Read More

Govt seeks nod for Rs170b supplementary budget

The Express Tribune (Dec 24, 2019)

ISLAMABAD: The federal government on Monday allowed the presentation of a report to the National Assembly for approval of an additional Rs170 billion in supplementary budget, bringing total excess expenditures over and above the approved budget to Rs392 billion in the last fiscal year. The Ministry of Finance could not properly estimate the over-spending in the first year of the Pakistan… Read More

IMF cuts FBR’s tax target to Rs5.23 trillion

The Express Tribune (Dec 24, 2019)

ISLAMABAD: The International Monetary Fund (IMF) has projected significant fiscal slippages and has finally cut the tax collection target to Rs5.238 trillion, which raises questions over claims of bringing fiscal discipline and restoring macroeconomic stability. The IMF expects Pakistan to miss the budget deficit target of Rs3.2 trillion and has projected excesses in almost all … Read More

Balochistan’s revenue collection increases by 164%

The Express Tribune (Dec 24, 2019)

ISLAMABAD: Balochistan government has collected Rs7.84 billion revenue so far in the first half of the fiscal year 2019-20, projecting around 164 per cent increase as compared to the corresponding period of last year. “Balochistan Revenue Authority (BRA) and other departments have collected huge revenue during the first six months of current fiscal year compared to Rs4.90 billion… Read More

FATF: PTI govt prepares draft to curb terror financing via NSS

The Express Tribune (Dec 23, 2019)

ISLAMABAD: In line with the FATF recommendations, the federal government has prepared an AML/CFT Rules 2019 draft for the prevention of money laundering and terrorism financing through National Savings Schemes (NSS). It has sought recommendations from all NSS stakeholders within seven days. In case they fail to submit proposals within the stipulated time, the gazette notification… Read More

Is Pakistan ready for economic growth?

The News (Dec 23, 2019)

Our knowledge of history, economics, and much more owes a lot to the works of Ibn Khaldun. With his usual keen eye, he said that “Government is an institution which prevents injustice other than such as it commits itself.” What was said 700 hundred years ago still holds true today. The government’s role is key in laying the base for a nation’s progress. At our Institute for Policy Reforms, I led a project … Read More

Pakistan to receive second tranche worth $452m from IMF next week

The Nation (Dec 22, 2019)

ISLAMABAD – Pakistan would receive second tranche worth of $452 million from International Monetary Fund (IMF) next week that would build the country’s foreign exchange reserves. The Executive Board of the IMF on December 19 has completed the first review of Pakistan’s economic performance under the Extended Fund Facility (EFF). The completion of the review will allow the authorities to… Read More

Digital economy to create 2m jobs, boost GDP to $40b

The Nation (Dec 22, 2019)

RAWALPINDI – Digital economy in Pakistan has huge potential for creating 2 million jobs and boosting the country’s Gross Domestic Product (GDP) up to the level of $40 billion in next couple of years. Transformation is required to promote the Information, Communications and Technology sectors to reposition Pakistan in the digital economy. The Rawalpindi Chamber of Commerce and… Read More

Economic stability result of Govt’s policies: Hammad

The Pakistan Observer (Dec 21, 2019)

Islamabad: Minister for Economic Affairs Hammad Azhar said that economy has been put on the track with strenuous efforts of the government under the leadership of the prime minister. In a statement on Friday, he said the IMF Board’s Review is indicating success of the government’s economic reforms. The Minister said Moody’s upgraded … Read More

Turkish Parliament Approves 2020 Budget

The (Dec 21, 2019)

Turkey’s parliament has approved the government’s 2020 budget, which includes increased defense spending and forecasts a budget deficit of 138.9 billion lira ($23.4 billion). The 2020 budget, which state-run Anadolu news agency said was passed with 329 votes in favor to 159 votes against, also projects increased spending on health and education, and foresees a rise in budget…Read More

Pakistan’s economic reform programme on track: IMF

The Pakistan Today (Dec 20, 2019)

ISLAMABAD: The Executive Board of the International Monetary Fund (IMF) has completed the first review of Pakistan’s economic performance under the Extended Fund Facility (EFF), saying that Pakistan’s economic reform is on track. The completion of the review will allow the authorities to draw $452.4 million, bringing total disbursements to $1.44 billion, said a press release issued by the… Read More

Current account deficit shrinks 72.6pc in Nov: Hafeez Shaikh

The Pakistan Today (Dec 20, 2019)

LAHORE: Adviser to Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh has said that current account deficit is down by 72.6 per cent on a year-on-year in November 2019, whereas it was reduced by 73 per cent during the first five months of FY20 against the same period of last year. The adviser said that during the last five months of the current fiscal year, the State Bank of Pakistan’s… Read More

19-month high: SBP reserves surpass $10b mark

The Express Tribune (Dec 19, 2019)

KARACHI: Government’s efforts to boost the foreign exchange reserves have borne fruit as the reserves held by the central bank have shot up to a 19-month high, surpassing the $10-billion mark. The foreign exchange reserves held by the central bank increased 18% on a weekly basis, according to data released by the State Bank of Pakistan (SBP) on Thursday… Read More

If Pakistan’s economy grows over 3.8%, it can trigger imbalances

The Express Tribune (Dec 19, 2019)

ISLAMABAD: The balance of payments crisis is imminent in Pakistan, if its economy grows more than 3.8% annually without fixing existing structural economic imbalances, finds a new Asian Development Bank’s (ADB) research paper. In order to avoid the next balance of payments crisis, Pakistan will have to fix its exports and reduce dependency on imports… Read More

Effective tax mechanism to boost economic activities

The Pakistan Observer (Dec 18, 2019)

Lahore: Low number of taxes, reduced frequency of payments and an effective mechanism of the refund payments would not only give a momentum to the economic activities but also help further improvement in ease of doing business index. Lahore Chamber of Commerce and Industry (LCCI) President Irfan Iqbal Sheikh, Senior Vice President Ali Hussam Asghar and Vice President Mian … Read More

‘Lower current account deficit a victory for businessmen’

The Express Tribune (Dec 18, 2019)

FAISALABAD: The current account deficit of Pakistan has decreased from $6 billion to $1 billion in the past four months, which is a victory particularly for the business community as it provides jobs to millions of workers, said Punjab Governor Chaudhary Muhammad Sarwar. Addressing an event at the Faisalabad Chamber of Commerce and Industry (FCCI) on Tuesday, Sarwar pointed … Read More

Foreign Direct Investment surges 78.1pc in five months

The Pakistan Today (Dec 17, 2019)

ISLAMABAD: Foreign Direct Investment (FDI) in Pakistan surged 78.1pc to $850 million in July-November FY20, as compared to the investment of $477.3 million in the same period of last year. On a year-on-year basis, however, the FDI decreased to $200.1 million in November 2019 as against $285.4 million in the same month of 2018, according to the data released by State … Read More

Development spending grows 27pc in July-Oct

The News (Dec 17, 2019)

ISLAMABAD: Provincial governments have cumulatively spent Rs112 billion on developments during the first four months of the current fiscal year of 2019/20, depicting 27 percent year-on-year growth, finance division said on Monday. Combined development spending of the four provinces amounted to Rs88 billion during the corresponding months of the last fiscal… Read More

Hot money flows – looking beyond temporary relief in Pakistan

The Express Tribune (Dec 16, 2019)

KARACHI: The current account surplus reported in October 2019 marks a shift from an otherwise persistent current account deficit. It is an achievement for the government in terms of its objectives to curtail the current account deficit, particularly as it faces several challenges on the economic front. A survey of the summary of balance of payments reported by the State Bank of Pakistan (SBP) indicates a $253-million…Read More

Foreign investment in Pakistan debt markets should be seen positively: SBP

The Pakistan Today (Dec 16, 2019)

KARACHI: The increase in investment by foreign investors in debt instruments is an encouraging sign for the Pakistani economy, the State Bank of Pakistan (SBP) said on Monday. “Recently, international investors have started investing in debt instruments issued by the Government of Pakistan. This is largely a manifestation of their growing confidence in the positive … Read More

Gwadar port operationalised for exports

The Express Tribune (Dec 15, 2019)

ISLAMABAD: The Gwadar port has been operationalised for export, Adviser to Prime Minister on Trade and Industries Abdul Razak Dawood announced on Saturday, saying that it would reduce the burden on the Karachi port. Dawood said on the microblogging website Twitter that the departure of a vessel, carrying three fish containers worth $50,000 each, for… Read More

35pc budget allocated for eliminating inter-district disparity in Punjab

The Pakistan Observer (Dec 14, 2019)

Lahore: Finance Minister Makhdoom Hashim Jawan Bakht on Friday revealed that 35 percent budget had been allocated for eliminating inter-district disparity in the province. This policy is aimed at ensuring inclusive growth so that all the people could equally benefit and grow.
He stated this while addressing a seminar at Government College University on… Read More

‘Pakistan on track to fulfilling FATF conditions’

The Pakistan Today (Dec 14, 2019)

KARACHI: The government is on track to fulfilling all necessary conditions of the Financial Action Task Force (FATF), State Bank of Pakistan Governor Dr Reza Baqir said on Saturday. He was speaking at the Financial Crime Summit, a conference organised in Karachi to discuss the way forward for Pakistan post-FATF. The governor sounded cautiously optimistic,… Read More

Centre seeks deduction from NFC to pay off loans

The Express Tribune (Dec 14, 2019)

ISLAMABAD: The Finance Division has proposed to the country’s economic managers to make at source deduction from provincial financial shares under the National Finance Commission (NFC) Award to pay the outstanding loans acquired by provincial food departments from commercial banks. These loans are backed by secondary guarantees issued by the Finance… Read More

PIA records Rs32.7bn loss in first half of 2019

The Pakistan Today (Dec 13, 2019)

KARACHI: Pakistan International Airline (PIA) and its subsidiary, PIA Investments Limited, continue to bleed massively due to a variety of reasons, ranging from mismanagement to lack of transparency and weak audit controls by independent auditors as well as the Auditor General of Pakistan. Nur Khan succeeded not because of his Air Force combat experience but his self… Read More

World Bank to finance Khyber Pass Economic Corridor project with a loan of $406.6 million

The Dawn (Dec 13, 2019)

The World Bank will provide $406.6 million for the Khyber Pass Economic Corridor (KPEC) project which will promote economic development and uplift areas adjoining the expressway and falling in Khyber Pakhtunkhwa (KP). An agreement to this effect was signed in Islamabad on Friday, according to a statement by the Economic Affairs… Read More