Positive shift: Pakistan records primary surplus in 1QFY24

October 25, 2023 (MLN): Pakistan turned around in the first quarter of fiscal year 2024, recording a primary surplus of 0.4% of GDP (Rs416.81 billion) as against a primary deficit of 1.4% (Rs1.19 trillion) in the previous quarter, as per data reported by Finance Ministry.

While in the same period of last year (1QFY23), the government had recorded a primary surplus of 0.2% of GDP (Rs134.67bn).

On the other hand, the country's overall fiscal deficit in the first quarter of FY24 stood at 0.9% of GDP (Rs962.8bn) against 1% of GDP (Rs819.31bn) in the same period of last year.

The government plugged this deficit through domestic borrowing of Rs537.63bn, while the remaining amount was borrowed externally.

In the same period last year, the government's domestic and external borrowings to aid the budget deficit stood at Rs778.37bn and Rs40.94bn respectively.

On the revenue front, the government reported total revenue of Rs2.69tr as against Rs2.02tr in 1QFY23.

The tax revenue contributed around Rs2.22tr (82.54% of the total revenue) while the remainder of Rs468.82bn was through non-tax revenue. 

Within the overall tax collection, majority of it came from direct taxes which stood at Rs934.79bn, another Rs252.22bn came from customs, Rs726.9bn from sales tax and Rs127.6bn through Federal Excise Duties. 

Moreover, under the non-tax revenue head, the major chunk was contributed by petroleum levy at Rs222.1bn as compared to Rs47.47bn in 1QFY23.

On the expenditure front, the government spent a total of Rs3.65tr, of which nearly 87% (Rs3.17tr) was done to manage current expenditures, which mainly included mark-up payments (Rs1.38tr), defence (Rs343.1bn), pension (Rs203.3bn).

To note, government data showed that Sindh and Baluchistan recorded a budget surplus in 1QFY24, clocking in at Rs19.1bn and Rs71.2bn respectively.

On the other hand, Punjab and KPK suffered a deficit of Rs28.55bn and Rs10.3bn respectively.

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