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Wednesday July 24, 2024

CM Murad to present Sindh's budget on 'June 14'

No money will be allocated for new development schemes in Sindh's budget, say sources

By Kamran Razi
June 12, 2024
Sindh Assembly after taking oath of newly-elected lawmakers on February 24, 2024. — NNI
Sindh Assembly after taking oath of newly-elected lawmakers on February 24, 2024. — NNI

KARACHI: Sindh Chief Minister Murad Ali Shah is slated to present the province's budget for fiscal year 2024-2025 on June 14, Geo News reported quoting sources on Wednesday.

According to the sources, in its upcoming budget for the next fiscal year, the provincial government will propose at least 10% to 15% increase in the salary of Sindh's government employees.

No money, they added, will be allocated for new development schemes in Sindh's budget and that funds for development projects will be released for ongoing projects.

The federal government, on the other hand, will unveil the upcoming budget for the next financial year, 2024-2025, today.

As per analysts, the budget sets ambitious fiscal targets as it looks to strengthen the case for a new bailout deal with the International Monetary Fund (IMF), Reuters reported.

The budget comes a day after the government said economic growth of 2.4% expected in the current year would miss a target of 3.5%, although revenues were up 30% over last year, and the fiscal and current account deficits were under control.

Pakistan is in talks with the IMF for a loan estimated to range from $6 billion to $8 billion, as it seeks to avert a default for an economy growing at the slowest pace in the region.

But a recent economic uptick, following stabilisation measures and falling inflation, as well as Monday's interest rate cut by the central bank, has made the government optimistic about prospects for growth.

The key policy rate could fall further this year and economic growth would continue to rise, Finance Minister Muhammad Aurangzeb, set to present his first budget, told reporters on Tuesday.

Markets will watch the budget for a target for proceeds from privatisation, as Pakistan looks to make its first major sale in nearly two decades with the disposal of a stake in its national airline, kicking off a series of such moves.

But concerns remain about the government's ability to pursue reform, since it is vulnerable to the quirks of coalition politics in the face of rising public pressure against inflationary reform measures.

Tapping under-taxed sectors such as agriculture and retail for additional revenues would prompt protests by farmers and small traders, while spending cuts in discretionary funds for MPs have already squeezed alliances and party loyalties.