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November 01 , 2024
Pakistan Posts Fiscal Surplus for First Time in 24 Years
Islamabad: Unprecedented profits by the State Bank of Pakistan (SBP), driven by the highest-ever interest rates and record petroleum levy revenue — both non-tax sources — have helped the country convert its entrenched budget deficits into a fiscal surplus for the first time in at least 24 years.
According to the Fiscal Operations report for the first quarter (July-September) of the current fiscal year, released by the Ministry of Finance on Thursday, the central bank posted an all-time high surplus profit of Rs2.5 trillion, primarily due to the country’s highest-ever policy rate of 22 per cent.
This gain was also supported by a record Rs262 billion earned from the petroleum levy, an 18pc increase from last year.
Due mainly to the SBP’s record profits, the country’s fiscal balance — the gap between national revenues and expenditures — reached a surplus of Rs1.696tr, or 1.4pc of GDP, in the first quarter.
This is in sharp contrast to the 0.9pc deficit recorded for the same period last year and marks the first time Pakistan has achieved a budget surplus, breaking a 24-year cycle of consecutive fiscal deficits since FY2001, the earliest year for which public data is available.
The country’s primary surplus, which excludes interest payments from the fiscal balance, also touched a historic peak of more than Rs3tr, or 2.4pc of GDP, almost double the full-year target of 1pc of GDP, or about Rs1.24tr… - Dawn
Courtesy Dawn
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