The Federal Government of Pakistan is all set to present budget 2018-19 totaling Rs5.5 trillion on Friday (Today). According to the sources, the total amount in the budget exceeds the previous budget of 2017-18 which was Rs4.75 trillion, the total outlay of the budget would be Rs5.5 trillion this fiscal year.
The defense budget of Pakistan is likely to increase from Rs920 billion to Rs1.5 trillion in the next fiscal year along with the supplementary grant of Rs60 billion according to the sources.
However, PakistanToday said that the defense budget would be Rs1.050 trillion instead of Rs1.5 trillion. For debt servicing, it is likely that the government will allocate Rs1.550 trillion. The government is also mulling to increase the pensions and salaries by 10 to 15 percent. Moreover, Rs220 billion will be allocated for government subsidies—it said.
The cabinet earlier had approved Rs1.1 trillion for regular defense budget additionally, the government has approved Rs100 billion for Armed Forces Development Program (AFDP) making it total of Rs1.2 trillion.
Federal Board of Revenue (FBR) officials said the tax collection target could be negatively affected due to the introduction of Amnesty Scheme. However, the tax collection target for the next fiscal year would be fixed at Rs4450 billion with an estimated increase of 15 percent.
The government is also expected to raise the salaries and pensions of the employees in order to get political benefits from it. It is expected to increase the salaries up to 10 percent but most likely 7.5 percent increase would be definite. However, the government is focused on hiking pensions by 15 percent in the next budget.
The target for foreign debt has been fixed to $13 billion during the fiscal year 2018-19 the sources said. In order to push exports, the government has allocated Rs70 to Rs80 billion to support exporters in the budget.
The total size of federal public-sector development programs (PSDP) and provincial Annual development programs (ADPs) would be Rs2.043 trillion out of which Rs1.030 would be earmarked for federal PSDPs and Rs1.013 trillion for provincial ADPs.
The next year’s budget for development would be lower as compared to the current fiscal year. The PSDP 2018-19 is set at Rs825 billion including Rs175 billion of foreign exchange component (FEC) as compared to the previous Rs866 billion including FEC Rs162 billion.
However, PMs Advisor on finance Miftah Ismail said the total budget for PSDP would be Rs930 billion which is greater than the current fiscal year.
In the next financial budget 2018-19, the 50 percent of the budget will go for defense and debt servicing. The subsidies would also take a large chunk, the proposed Rs221 billion which is up from Rs144 billion in the current fiscal year.
Stay tuned for the budget highlights when it would be presented today, further details on the budget would be unveiled later on the budget 2018-19.