In the first quarter of this fiscal year, Pakistan achieved a significant feat. It eliminated the budget deficit through a 362 percent increase in the petroleum levy, substantial subsidy cuts, and reduced development spending, as reported by the Finance Ministry. However, there were concerning spending trends in Punjab and Khyber Pakhtunkhwa’s caretaker governments. Punjab, in particular, overspent by 28.6 billion rupees in July-September, putting its finances in the red. On the bright side, the Finance Ministry demonstrated a primary budget surplus of 417.41 billion rupees, meeting a crucial IMF requirement.
The IMF’s review mission plans to arrive on November 2, and they are set to release a $710 million tranche in December. This release depends on successful negotiations regarding non-tax revenue from the petroleum levy. Notably, the petroleum levy collection surged by 115 percent this year. Reaching 453 billion rupees in just three months, marking a remarkable 3622.04% increase from the previous year.
Pakistan’s Rising Budget Deficit and Borrowing Challenges
Despite reducing subsidies, the federal government continued to borrow for all expenditures, including defense. In the first three months, spending rose by 25% to reach 2.36 trillion rupees. Development expenditure also saw a significant drop of 30%, totaling less than 53 billion rupees. Punjab exhibited the weakest performance among provinces, spending 651 billion rupees against an income of only 22.16 billion rupees. Sindh and KP also experienced budget shortfalls, while Balochistan showed an exceptional surplus of 17 billion rupees.
Overall, the budget deficit, including interest payments. Reached 1,963 billion rupees in the first quarter, equivalent to 1% of the GDP. This represents an 18% increase from the previous fiscal year. Raising concerns about potential debt service cost overruns due to rising interest rates. Pakistan’s increasing debt burden has led to most borrowing being allocated to interest payments. The State Bank’s monetary policy committee will meet to determine the policy rate for the next two months.
The government initially aimed for a 6.5% GDP deficit in the fiscal year 2024, with a 6.9 billion rupee target. A 7.6% deficit could require borrowing an additional 1,300 billion rupees beyond the June plan. State Bank Governor Jameel Ahmed confirmed that the central bank met the first IMF review’s conditions, exceeding the $14.2 billion advance target. And fulfilling the IMF’s Net International Reserve (NIR) and Net Domestic Asset (NDA) targets by the end of September 2023.
Budget Allocation: 870 Million Rupees, Employee Salaries 25K-40K Rupees, Disrupting Opposition
During PTI’s rule, the official social media team revealed engaging in anti-state propaganda and exposed Chairman PTI’s plan to create a fake image. They used government resources to carry out fake publicity of PTI leadership and propagate false information against state institutions. Instead of promoting government projects, they employed social media teams to indiscriminately smear and vilify opponents, engaging in poisonous propaganda. They also attempted to incite activists and the public during the events on May 9 and to attack military installations through social media accounts.
The project’s budget, set at 870 million rupees in the Khyber Pakhtunkhwa annual development program, tasked social media teams with spreading malicious narratives. These social media accounts served political purposes, conducting propaganda campaigns and disseminating misinformation. The employees involved in the social media team earned salaries ranging from 25,000 to 40,000 rupees. Of the 800 pre-existing accounts engaged in PTI’s anti-state propaganda, 72.5 percent had no political affiliation with PTI before 2021. However, after June 2022, 86 percent of these accounts shifted their political alignment and began posting PTI’s narrative.
Government-Funded Propaganda and Disinformation by PTI Social Media Teams
According to government sources, the social media teams utilized the cover of the Annual Development Program (ADP) to spread PTI’s negative narrative and deploy fake social media teams to spread falsehoods. These accounts were used to advance PTI’s political objectives, disseminate disinformation and conspiracy narratives, and incite public sentiment. This disturbing revelation exposed the act of spreading anti-state narratives with government funding and the promotion of hateful narratives that have contributed to societal instability. PTI political operatives exploited the followers of these propaganda accounts, using government resources. Leading to a total project cost of 870 million rupees.
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