On Sunday, Prime Minister Shehbaz Sharif met with senior leaders of the Pakistan Peoples Party (PPP) to discuss the budget for the fiscal year 2024-25, which the federal government is set to present next month.
The meeting included PPP members Raja Pervez Ashraf, Chief Minister Sindh Murad Ali Shah, Sherry Rehman, and Naveed Qamar. They were joined by Deputy PM Ishaq Dar, Planning Minister Ahsan Iqbal, Adviser to the PM on Political and Public Affairs Rana Sanaullah, Law Minister Azam Nazeer Tarar, and Information Minister Ataullah Tarar. The discussions also covered the prevailing political situation in the country.
According to a report in the news, the federal government plans to present the next fiscal year’s budget on June 7, though the official date has not yet been announced.
This high-level meeting is crucial as the PML-N-led government, headed by PM Shehbaz Sharif, lacks the necessary majority in the National Assembly to pass the budget without PPP’s support.
The two parties had previously agreed to cooperate following the February 8 polls, with the PPP backing Shehbaz’s premiership in exchange for various constitutional positions such as Senate Chairman and governors of Khyber Pakhtunkhwa and Punjab.
Passing the FY2024-25 budget is particularly significant as Pakistan recently requested a bailout package from the International Monetary Fund (IMF) ranging from $6 to $8 billion under the Extended Fund Facility (EFF).
An IMF team, led by Mission Chief Nathan Porter, visited Islamabad from May 13-23, 2024, to discuss Pakistan’s economic plans that could be supported under the EFF. The IMF team gathered relevant economic data and indicated the type of budget it expects for 2024-25.
The IMF has acknowledged significant progress toward a Staff Level Agreement (SLA) on a comprehensive economic policy and reform program but has conditioned the next bailout package on the approval of an aligned budget.
The government will need to demonstrate its ability to increase Federal Board of Revenue (FBR) revenue and implement hikes in electricity and gas tariffs in July and August 2024 to secure the deal with the IMF, top officials confirmed to the news.
Therefore, the upcoming budget for 2024-25 will be a critical test for the current government to show its capability to meet the IMF’s stringent conditions.
