Former finance minister Miftah Ismail comments on Pakistan’s budget 2023-24
Introduction
In a recent statement, former finance minister Miftah Ismail commented on Pakistan’s budget 2023-24, saying that it is in line with the International Monetary Fund’s (IMF) demands and not very expansionary.
IMF demands
Ismail stated that the IMF demanded a primary surplus of 0.5%, and the government has set it at 0.4%, which is close to the lender’s benchmark. He claimed that this shows that the budget is in line with the IMF’s expectations, and needs to satisfy the IMF to secure the release of stuck bailout money for the crisis-struck country.
Budget details
The budget, announced by the incumbent finance minister Ishaq Dar, aims for a deficit of 6.54% of economic output in the fiscal year starting on July 1. Ismail criticized the way the government is increasing taxes and giving money to provinces, stating that this budget is not sustainable. He also criticized the authorities concerned for announcing a hefty increase in salaries.
Revenue and expenditure targets
Ismail said that if the IMF thinks that “your revenue and expenditure targets are practical, then it is not a very expansionary budget.” He added that the deficit target can be achieved by keeping in view the interest rate and GDP tax.
Budget restructuring
Miftah said that a lot of restructuring in the budget is needed as it is not sustainable. He asked for increasing the allocation for the Benazir Income Support Program (BISP) and demanded a cut in funds for the lawmakers.
Increased salaries and pensions
Speaking about the increased salaries and pensions of government employees, the former finance minister said that it is due to rising inflation and increased expenses, however, reforms are needed.
Conclusion
In conclusion, former finance minister Miftah Ismail believes that the budget 2023-24 is in line with the IMF’s demands, but is not very expansionary. He has criticized the way the government is increasing taxes, giving money to provinces, and announcing a hefty increase in salaries, and suggests that the budget needs restructuring for sustainability.
