KARACHI, October 31 2024: In a groundbreaking turn of events, Pakistan has announced its first-ever fiscal surplus, reporting an impressive Rs1.7 trillion, equivalent to 1.4% of its GDP, for the first quarter of FY25. This achievement marks a significant departure from the fiscal struggles that have plagued the nation over the past two decades.
The newly reported surplus is largely driven by a surge in non-tax revenues, which reached Rs3 trillion, with a remarkable Rs2.5 trillion attributed to the State Bank of Pakistan (SBP). This influx has bolstered the government’s financial standing and signals a potential shift in the country’s economic landscape.
Comparatively, during the same quarter last year (1QFY24), the government faced a budget deficit of 0.9% of GDP, alongside a primary surplus of just 0.4%. Notably, the SBP’s profit of Rs972 billion, credited to the government’s account in the second quarter of FY24, played a pivotal role in this turnaround.
Economists are cautiously optimistic, viewing this fiscal surplus as a sign of fiscal discipline and effective revenue management. The government’s ability to harness non-tax revenues, particularly from the SBP, indicates a proactive approach to economic stabilization.
As the nation celebrates this fiscal milestone, questions arise regarding sustainability and Pakistan’s economy’s future trajectory. Analysts urge continued vigilance in revenue generation and expenditure management to maintain this positive momentum.
In a country long characterized by budget deficits and economic volatility, this historic surplus may herald a new era of fiscal responsibility and growth potential. The coming quarters will determine whether this financial achievement can be sustained and built upon.
