Federal budget is based on unrealistic estimates therefore it may not serve the purpose of economic development amid the recession, experts observed during a “Post Budget” seminar organized by Karachi Branch Council (KBC) of Institute of Cost and Management Accountants of Pakistan (ICMAP).
The event was hosted by former chairman and current member KBC 2019-21 -Tariq Hussain while participants included President PBIF Mian Zahid Hussain, Chairman APTMA Sindh-Balochistan Zahid Mazhar, President Pakistan Economy Watch Dr. Murtaza Mughal, and former VP FPCCI Saqib Fayyaz Magoon.
The participants said that the current size of the federal government is unsustainable and it will add to debt and deficits as resource availability is scarce and it will lead to mini-budgets.
It is fiscally irresponsible to present a three trillion rupee deficit budget and it should not sail through without questions, they added.
The participants noted that problems like poverty and inequality cannot be addressed if the Rs2.9 trillion out of a total federal revenue of Rs3.9 trillion is used to service debts.
The revenue collection target does not take into account coronavirus impact on the economy, production, consumption, and exports, the business leaders said, adding that Rs650 billion for PSDP is a peanut for developing country like Pakistan.
Mian Zahid Hussain and Dr. Murtaza Mughal said how come the government enhance revenue when the overall GDP of the country is contracting and estimates of expenditure, resource allocation and revenue generation is not according to the ground realities.
The recent moves of the government suggest that it is not providing the environment needed for businesses to sustain in this pandemic situation as the cost of doing business is increasing which should be reduced.