By Muhammad Luqman
Pakistan’s Minster for Industries Hammad Azhar presented on Friday the federal budget for the fiscal year 2020 -21 with an outlay of Rs 7130 billion, calling it a relief oriented budget that would help offset the effects of corona pandemic and locust invasion that has badly affected the economy of the South Asian nation.
While delivering the budget speech in National Assembly, the lower house of Pakistan’s parliament, Hammad Azhar said that the Federal Board of Revenue (FBR) revenue target was kept at Rs4.95 trillion for next year while defence allocations amounted to around Rs1.3 trillion.
The federal development programme has been earmarked at Rs650 billion to support growth prospects especially those of infrastructure.
Prime Minister Imran Khan also attended the session. Azhar started the session by saying it was an honour for him to be presenting the second budget of the PTI government under the leadership of PM Imran.
He then went on to highlight some of the major achievements of the government in the outgoing fiscal year, pointing to a 73 per cent decline in the current account deficit, which is now under $3 billion, he said. “There is also a primary surplus which we achieved in the past nine months,” he said.
وزیر اعظم آفس کے اخراجات میں 21 فیصد کی ریکارڈ کمی
— Prime Minister's Office, Pakistan (@PakPMO) June 12, 2020
In the background of Azhar’s speech, loud slogans against the premier and table-thumping by the opposition benches could be heard as the minister highlighted the PTI-led government’s efforts to streamline the economy. Later, the opposition walked out of the House in protest, English newspaper, Daily Dawn reported.
Azhar said “our budget deficit shrank from 5pc to 3.8pc while IMF gave us an extended facility of Rs6 billion and remittances increased from Rs16b to Rs17b”. He noted that Bloomberg had called PSX the top performing market in Dec 2019.
Presenting details of the new budget, the minister emphasised that “no new tax was introduced in this budget”. He said the need of the hour was an expansionary fiscal policy which the government was implementing.
He said the total size of the budget or the total expenditure budget for the next year stood at Rs7,136 billion — slightly higher than the budgeted figure for the previous year.
Of this total, current expenditure for the next fiscal year was budgeted at Rs6,345 billion, up from the Rs6,193b budgeted last year, Azhar said. Of this, Defence Affairs make up Rs1,289 billion, up 11pc from the previous year, with interest payments making up Rs2,946 billion.
Allocations for education have been budgeted at Rs83.3 billion, up 7.9pc from last year’s Rs77.2 billion. Health allocations for the next year have more than doubled (130pc rise) to Rs25.5 billion from last year’s Rs11 billion. During his speech, Azhar explained that the funds would be used to improve health services and digitise the framework.
Hammad Azhar said that the total expenditure for public sector development program (PSDP) for the next fiscal year had been fixed at Rs1,324 billion, which is 18pc below last year’s budget.
Of this, federal PSDP has been allocated Rs650 billion, while Rs676 billion has been allocated to provinces.