On June 10, Pakistan armed forces development programme has been gashed by Rs72 billion or one-fifth of the allotment in order to achieve basic budget surplus keeping in mind to meet a major condition of the International Monetary Fund (IMF) in the new fiscal year.
Basic budget surplus of Rs153 billion or 0.2% of the national output is the central condition of International Monetary Fund for the rallying of the bailout package. Miftan Ismail, Finance Minister hopes to clinch the staff level deal before this week.
Government allocated budget in National Assembly on June 10 as of Rs 363 billion against armed forces development programme.
Whereas, as per the revised budget the provision has been decreased to Rs291 billion. It has been confirmed by Ministry of Finance after the approval from National Assembly. However, the budget provision has been reduced to Rs291 billion.
Second time it has been observed as in many years that the armed forces development programme has been gashed by Rs 72 billion or approximately 20% because of fiscal constraints and limitations imposed by International Monetary Fund
As per the previous fiscal year, the last government had allot Rs 340 billion for the same purpose even though the actual disbursement shown as Rs270 billion as per the budget book.
Last year, sources confirmed that government decided to decrease the allocation for armed forces.
To meet the expenses in an order where the basic budget surplus need to be achieved of IMF, confirmed by an official of the Ministry of Finance.
The primary budget surplus target at Rs153 billion or 0.2% of GDP on back of Rs750 billion provincial cash surpluses set by government.
Even though, as per the provincial budget it doesn’t show the Rs750 billion savings and to save the provincial endorsement through memorandum of understandings (MoUs) asked to the government by IMF.
