Punjab’s budgetary borrowing more than doubles to Rs753 billion in seven weeks

Punjab's borrowing from banks to support its budget has more than doubled, reaching Rs753.4 billion in the opening seven weeks of FY27. That compares with Rs306.8 billion in the corresponding period last year, a rise of over 145%, according to Dawn, which cited State Bank of Pakistan data. Over the July 1 to August 21 window, federal borrowing for budgetary support stood at Rs571 billion, below the province's figure.

Provincial positions differed considerably. Sindh's balance with the SBP stood at Rs69.6 billion in deposits, Balochistan's at Rs43.4 billion, and Khyber Pakhtunkhwa had borrowed Rs1.8 billion. According to the central bank, a minus figure in government deposits means a credit balance, whereas a plus figure marks money taken out of the banking system.

The divisible pool used to set federal and provincial shares is fixed at Rs13.35 trillion, compared with the Rs15.264 trillion tax take forecast for FY27. That leaves roughly Rs1.9 trillion for the federal government beyond the pool. Provinces depend on federal transfers for as much as 78% of their revenues, and about 80% of consolidated provincial spending goes on recurrent costs, according to World Bank reports.