Govt exceeds IMF surplus target

The Ministry of Finance's fiscal summary, released on Thursday, shows a primary surplus of Rs3.63 trillion in fiscal year 2025-26, the third straight year of such a surplus. The figure beat the IMF target of Rs3.16 trillion by Rs464 billion and equalled 2.6% of GDP. Officials said that even after adjustments for foreign project loans and higher circular debt flows, the government comfortably met the Fund's non-negotiable condition, according to The Express Tribune.

The federal deficit for the year came to Rs4.8 trillion, Rs1.7 trillion below target, helped by Rs1.3 trillion less in interest payments than budgeted. Petroleum levy collection reached Rs1.567 trillion, Rs101 billion above target and 28% higher than last year, while federal development spending was Rs82 billion lower. Tax collection fell short, with the FBR gathering Rs13 trillion, nearly Rs1 trillion under the IMF's revised goal, even as public debt grew 7%.

Provincial governments generated a combined cash surplus of Rs1.45 trillion, missing the IMF condition by Rs14 billion, with Punjab alone saving Rs914 billion. The Ministry also reported a statistical discrepancy of Rs853 billion. An IMF mission is expected in the third week of September to review performance and recommend release of a $1.1 billion loan tranche.