Shehbaz-led govt borrowed Rs2.6trn for budgetary support in 8MFY23

The centre's borrowing for budgetary support surged by 259 per cent to cover the fiscal deficit

KARACHI (Web Desk) - The Shehbaz-led government, who is currently passing through historic cash crisis, borrowed more than Rs2.6 trillion from the country's banking system for budgetary support during first eight months and 11 days of current fiscal year (2022-23), the State Bank of Pakistan (SBP) data shows.  

The centre's borrowing for budgetary support surged by 259 per cent to cover the fiscal deficit. The government has borrowed Rs 2.6 trillion from the banking system including the SBP and commercial banks between July 1, 2022 and March 11, 2023 against Rs723.2 billion in the same period of last fiscal year (FY22), depicting an increase of Rs1.88 trillion.

The borrowing for budgetary support from the scheduled banks jumped by 253pc or Rs 1.437tr reaching Rs2.006tr in March 2023 up from Rs568.23bn in June 2022. The borrowing from the SBP also swelled up by 285pc or Rs442.4bn to Rs597.43bn during July 1, 2022 to March 11, 2023 compared to Rs155bn in the corresponding period of last fiscal year.

The provincial governments returned a significant amount to the central bank and scheduled banks during the period under review. The Balochistan government retired Rs29.651bn, Khyber Pakhtunkhwa Rs19.699bn, Punjab government Rs191.261bn, and Sindh repaid Rs5bn to the SBP.

Cumulatively, the federal and provincial governments borrowed Rs2.2tr between July 1, 2022 and March 11, 2023 for budgetary support from the domestic banking system as compared to Rs243.4bn in the same period of last fiscal year.