Government plans $2bn Eurobonds in upcoming budget
Business
Debt servicing is anticipated to consume a major Rs7.5 trillion in upcoming budget
ISLAMABAD (Web Desk) - The government aims to raise $2 billion funds by issuing Eurobonds during the upcoming fiscal year 2023-24.
The government is currently facing challenges to manage the budget due to limited dollar inflows through foreign loans and the non-revival of the International Monetary Fund (IMF) program.
Despite these challenges, the government plans to secure over $22 billion in foreign loans during the upcoming fiscal year. The process of finalizing the expectations and allocations is still ongoing on account that the issuance of Eurobonds will contribute $2 billion to the overall funding.
In the previous fiscal year, the government had intended to issue international bonds but reluctantly halted the program due to poor credit rating, the non-revival of the IMF program, and increased bond rates and risks.
As part of the budget proposals for 2023-24, the government has suggested implementing an income levy on all types of assets and raising withholding taxes on cash withdrawals along with the vehicle registration charges.
To achieve a primary balance of 0.1% of GDP, it is expected that the provinces will generate a revenue surplus of 1%. This surplus would help bring the primary balance into a slightly positive range in the next budget. Debt servicing is anticipated to consume a significant portion, amounting to Rs7.5 trillion, of the budget.
