Cash crunch: Looming bankruptcy as AJK govt runs out of money for fuel, salaries

Overdraws Rs22b from State Bank of Pakistan

MUZAFFARABAD: Vehicles belonging to the government of Azad Jammu and Kashmir (AJK) have ground to a halt after the government ran out of money to buy fuel for them and the State Bank of Pakistan stopped clearing its cheques for having overdrawn its account, informed sources told The Express Tribune.

Government sources familiar with the matter told The Express Tribune on condition of anonymity that the government had so far borrowed over Rs22 billion from the state bank, exceeding its set limit.

“We have no funds to buy fuel for the vehicles and it has affected our work routine in the finance department for the last one week,” an official said on the condition of anonymity.

“Our salaries too have not been released,” he said, adding that all government employees were concerned about it. In addition to departments in the capital city, government intuitions at the district level too were facing acute shortage of funds to meet their expenses.

The sources, however, said that the health and police departments are currently exempt from this cash crunch and officials in Muzaffarabad were seen going about their duties as per normal on Sunday. An official from AJK’s finance department, however, said that they expect the situation to be resolved this week.

“We expect the Kashmir Council to release around Rs1.6 billion from AJK’s due share of income in this week,” he said while requesting not to be named. He added that official correspondence in this regard was in process.

Published in The Express Tribune, October 3^rd, 2016.