Centre borrowed Rs 443 billion against budgeted Rs 166 billion

The government borrowed Rs 443 billion from domestic sources during the first six months of the current fiscal year to finance the budget deficit against an estimated Rs 166 billion earmarked in the budget for the entire fiscal year, according to fiscal operation report.
The fiscal operation for July-December 2010-11, released by the Ministry of Finance here on Monday showed that 2.9 percent consolidated fiscal deficit for the six months was financed by borrowing from the central and commercial banks. Analysis of the statistics showed a dismal state of external inflows for budgetary support with only Rs 46 billion disbursed during the first six months, in contrast to the Rs 185 billion, estimated on this account in the budget for the current fiscal year.
The reason behind the slow release of approved external assistance was the stalled Stand By Arrangement (SBA) of the International Monetary Fund (IMF) and the consequent unwillingness of other multilaterals and bilaterals to release assistance without issuance of letter of comfort by the Fund. The disparity between revenue and expenditure is alarming with total consolidated expenditure going up to 8.6 percent of the GDP during the first six months of the current fiscal year against total revenue of only 5.8 percent of GDP.
Total expenditure jumped to Rs 1480 billion, against Rs 989 billion revenue collection for the period under review. The provincial contribution in Rs 989.618 billion six months revenue collection was a mere Rs 52 billion. Tax and non-tax revenue collection at federal level was Rs 693 billion and Rs 242 billion and at provincial level Rs 27 billion and Rs 25 billion respectively. Of the total 5.8 percent revenue collection, 4.2 percent was tax revenue and 1.6 percent was non-tax revenue.
On expenditure side, analysis of the data showed that total revenue collection of 5.8 percent of GDP during the first six months of the current fiscal year was insufficient to even meet the two main components of current expenditure--interest payment and Defence expenditure--during the period. The consolidated current expenditure for the first six months stood at Rs 1226 billion: Rs 310 billion for interest payment and Rs 214 billion for Defence expenditure during July-December 2010-11.
Total releases for Public Sector Development Projects (PSDP) stood at Rs 124 billion (excluding development grants to provinces) that included Rs 66 billion to the federal and Rs 58 billion to provincial PSDPs.
The fiscal operation of the provinces showed that total revenue of the Punjab government was Rs 210.864 billion during July-December 2010-11 and expenditure Rs 194.209 billion, reflecting a surplus of Rs 16. 655 billion. Punjab received Rs 186.408 billion as its share from federal revenue while its own revenue generation was Rs 24.457 billion with Rs 14.298 billion through provincial taxes and Rs 10.159 billion from provincial non-taxes.
Sindh''''s total revenue during the first six months of the current fiscal year was Rs 135.268 billion while its expenditure was Rs 121.632 billion, showing a surplus of Rs 13.636 billion. The province received Rs 118.552 billion as its share from federal revenue while collection on account of provincial taxes and non-taxes was Rs 11.648 billion and Rs 2.682 billion respectively. The provincial government also received Rs 2.386 billion as loans and grants from the federal government.
Total revenue of Khyber Pukhtunkhwa during the first half of the current fiscal year remained at Rs 107. 079 billion and its expenditure was Rs 67.285 billion showing a surplus of Rs 39.794 billion. The province received Rs 64.001 billion as share of federal revenue and collected Rs 10.484 billion provincial non-tax income and Rs 1.468 billion on account of tax. The province also received Rs 31.126 billion from federal government on account of loans and grants.
The fiscal operation of Balochistan showed that provincial revenue was Rs 64.140 billion during the first six months of the current fiscal year while its total expenditure was Rs 34.194 billion, showing a surplus of Rs 29.946 billion. The province received Rs 49.628 billion as share from federal revenue and its own collection on account of revenue generation through taxes and non tax income was Rs 427 million and Rs 1.947 billion respectively.