Fiscal deficit narrows to Rs6tr in FY25

August 5, 2025 (MLN): Pakistan recorded a fiscal deficit of Rs6.17 trillion (-5.4% of GDP) in the fiscal year 2025, as compared to a fiscal deficit of Rs7.2tr (-6.8% of GDP) in the same period of last year, as per data reported by Finance Ministry.

Meanwhile, the primary surplus stood at Rs2.72tr (2.4% of GDP) in FY25 as against a primary surplus of Rs952.92 billion (0.9% of GDP) in FY24.

The government plugged the fiscal deficit through domestic borrowing of Rs982.18bn but saw a net outflow of Rs67.03bn in external financing.

In the same period last year, the government's borrowings to aid the budget deficit included an amount of Rs5.55tr borrowed domestically, and Rs618.83bn through external financing.

On the revenue front, the government reported a total revenue of Rs17.99tr (15.7% of GDP) as against Rs13.26tr (12.5% of GDP) in FY24.

The tax revenue contributed around Rs12.72tr (11.1% of the total revenue) while the remainder of Rs5.27tr was through non-tax revenue.

Within the overall tax collection, majority of it came from direct taxes which stood at Rs5.79tr, another Rs3.9tr came from sales tax, Rs1.28tr from customs, and Rs766bn through Federal Excise Duties. 

Moreover, under the non-tax revenue head, the major chunk was contributed by the surplus profit of the State Bank of Pakistan at Rs2.62tr.

This was followed by petroleum levy worth Rs1.22tr as compared to Rs1.02tr in the same period last year.

On the expenditure front, the government spent a total of Rs24.16tr (19% of GDP) as compared to Rs20.47tr (19.3% of GDP) in the same period of last year.

Of the total expenditure, 19% (Rs24.16tr) was spent to manage current expenditures, which mainly included mark-up payments (Rs8.88tr), defence (Rs2.96tr), and pension (Rs910.89bn).

To note, government data showed that all four provinces recorded a budget surplus, with Sindh, Baluchistan, Punjab, and KPK's overall balance clocking in at Rs283bn, Rs113.77bn, Rs348.46bn, and Rs176.17bn, respectively.

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