Ayesha Mudassar

The government's fiscal consolidation efforts have yielded favorable results in terms of improving fiscal accounts during the first nine months of the outgoing fiscal year 2022-23, reports WealthPK. Domestic revenue mobilization and prudent expenditure management resulted in a decline in non-interest expenditure and buildup of surplus in primary balance, said Finance Minister Ishaq Dar while presenting the Economic Survey 2022-23.

As per the survey, fiscal deficit reduced to 4.6% of GDP during Jul-Apr FY23 compared to 4.9% in the same period of last year. Similarly, the primary balance posted a surplus of Rs99.1 billion against a deficit of 890.2 billion during the period under review, reflecting a slowdown in the growth of non-interest expenditures.

According to the consolidated fiscal operations, total revenues increased to Rs6.93 trillion during Jul-Mar FY2023 against Rs5.87 trillion last year. Both tax and non-tax collection contributed to an increase in the overall revenues. Effective implementation of administrative and enforcement measures increased tax revenues by 16.5% to Rs5.62 trillion during Jul-Mar FY23 against Rs4.82 trillion in the corresponding period last year. Furthermore, the non-tax revenue grew by 25.5% to Rs1.32 trillion during the examined period.

The total expenditures grew by 18.7% to Rs10.01 trillion during Jul-Mar FY23 against Rs8.43 trillion last year. The current expenditure grew by 25.3% to Rs9.24 trillion during the nine months of FY2023. The higher interest rate along with the massive rupee devaluation has significantly increased the debt servicing costs. Development expenditures and net lending recorded a marginal increase of 0.9% to Rs1.01 trillion during Jul-Mar FY2023 against Rs1.05 trillion in the last year.

Within total, the expenditure under Public Sector Development Programme registered a decline of 2% to Rs1.01 trillion in Jul-Mar FY2023 against Rs1.03 trillion last year.The current fiscal performance indicates that despite a challenging economic environment, fiscal consolidation efforts are on the track. Moreover, it is anticipated that the coming months would see a considerable decline in the fiscal deficit.

Credit : Independent News Pakistan-WealthPk