The total inflows of external financing are expected to be over US$ 11.653 billion during the upcoming fiscal year (2018-19).
“Total inflows of external financing are expected to be US$ 11,653.9 million during 2018-19 with project loans US$ 4,835.2 million and programme loans US$ 1,818.6 million,” Economic Affairs Division sources said.
According to break up figures, the country would receive financing of $3130.8 million from bilateral sources which may include Germany, China, Japan, America, Saudi Arabia and others.
Another major chunk of inflows of $3523.1 million would come from the multilateral sources while the government is estimated to collect $3 billion from raising bond and $2 billion from commercial banks, the sources added.
“The government will adhere to the policy of fiscal consolidation during 2018-19 to maintain the fiscal deficit in manageable limits and within the ceilings of Fiscal Responsibility and Debt Limitation Act (FRDLA), 2005,” they added.
FBR Tax Regime
On the other hand, the FBR will continue its tax reform programme for broadening the tax net and reforming the tax administration.
The debt management functions would be primarily focused on fulfilling the financing needs at lowest possible costs, consistent with a prudent degree of risks’ broadening the investor base and a well-functioning domestic debt capital market; lengthening the maturity profile of domestic debt, and mobilization of maximum available soft external financing.
Trade Deficit On The Low
Meanwhile, the sources said that the fiscal performance remained on track during the first half of 2017-18 with a deficit of 2.3 percent of GDP against the annual target of 4.1 percent and 2.5 percent of the comparable period of last year due to higher growth of total revenue and comparatively lower growth of current expenditure.
The analysis of financing-mix of the fiscal deficit during the period under review reveals that the government relied more on domestic than external resources.
Within domestic resources, greater reliance was on bank borrowing to the tune of Rs. 332 billion.
Pakistan’s gross public debt stock as of 31st December 2017 stood at Rs. 22,821 billion, registering a growth of 6.6 percent over the debt stock as on 30th June 2017.
The build-up in public debt was on account of both domestic and external debts which grew by 4 percent and 12.6 percent, respectively.
Net government debt stood at Rs. 20,879 billion during the same period, posting a growth of 6.3 percent. The gross public debt was 67 percent during 2016-17 which was slightly below the previous year’s level of 67.7 percent.