Pakistan’s fiscal deficit has increased to 8.9 percent of the Gross Domestic Product (GDP) in the fiscal year that ended in June, marking a three-decade high.
Last year’s fiscal deficit was recorded at 6.6 percent of the GDP. The country has to increase its revenue by over 40 percent, as it is part of the conditions set for the $6 billion bailout by the International Monetary Fund (IMF).
The high fiscal deficit does not bode well for the country’s prospects, as the IMF’s first quarterly review of the bailout program is a few weeks away. Missing the revenue target can influence the award of the second tranche of the IMF bailout.
As per experts, Pakistan’s total revenue has declined by 20 percent in the latest quarter as the non-tax revenue declined by 98 percent.