Home / Brokerage / Govt. saves PkR 60bn, curbing fiscal deficit to 1.1% in 1QFY12 – Alfalah Securities Limited

Govt. saves PkR 60bn, curbing fiscal deficit to 1.1% in 1QFY12 – Alfalah Securities Limited

Karachi: The government has been successful in saving PkR 60 bn through actively managing the development and current expenditure which has helped curbing the fiscal deficit to 1.1% of GDP or PkR 232bn in the 1QFY12.

According to Alfalah Securities, the government saved PkR 25bn through the Public Sector Development Program (PSDP) as it released PkR 50 billion out of the allocated target of PkR 75bn while, it saved an aggregate of PkR 35bn from limiting the current expenditure on various heads which includes PkR 16bn savings through managing current expenditure on grants and subsidies for which PkR 180bn were released against the allocation of PkR 196 bn during the 1QFY12 period.

Furthermore, the government has also been successful in saving PkR 9 bn through interest payments owing to a 50bps cut in the discount rate by the State Bank in the first quarter of the ongoing fiscal year. However, Alfalah Securities expects the fiscal deficit to hover at 5% of GDP owing to scheduled repayments of loan to the IMF under the Stand-by Arrangement (SBA) which would begin in February, 2012.

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