Cash-strapped Pakistan Approves Rs 14.48 Trillion Budget For 2023-24

Pakistan’s Parliament on Sunday approved the Rs 14.48 trillion budget for 2023-24 after new taxes were added to it as dictated by the IMF as a condition to release the remaining portion of an already agreed bailout package for the cash-strapped country. The budget aiming to achieve 3.5 per cent GDP growth was unveiled on June 9. It aimed to collect Rs 9,200 billion in taxes but the target was hiked by Rs 215 billion at the behest of the International Monetary Fund (IMF) to make it Rs 9,415 billion.

The government also agreed with the IMF’s demand to cut its spending by Rs 85 billion. In his speech to sum up the debate on the budget, Finance Minister Ishaq Dar said that changes have been made in the budget after marathon three-day talks with the Washington-based global lender.

Prime Minister Shehbaz Sharif met IMF Managing Director Kristalina Georgieva on the sidelines of the Global Financing Summit in Paris two days ago and urged to release the loan. The IMF chief is reported to have asked Sharif to resolve policy differences at the global lender’s staff level prior to getting a much-needed loan to stabilise the country’s economy.

A USD 6.5 billion bailout package agreed in 2019 is expiring on June 30 and Pakistan is scrambling to get USD 1.1 billion out of unpaid funding. It is feared that Pakistan might default on external financing commitments without the active support of the IMF. Pakistan’s economy has been in a free fall mode for the last many years, bringing untold pressure on the poor masses in the form of unchecked inflation, making it almost impossible for a vast number of people to make ends meet.