It has not been a good financial year for Pakistan. The Covid-19 virus has taken a giant toll on the economy, not only with the lockdown and the drop in purchasing power of consumers but also with regard to the funds that the government has had to allocate to combat the pandemic.
The locust attacks have proved to be equally disastrous and pose as a great threat to the economy as well as food security. Moreover, Pakistan’s debt has been the highest in years. This leaves the government with little fiscal space to make any substantial breakthroughs for the new financial year. The federal budget 2020-21 should thus be assessed with these considerations in mind. For the despondent reality the country is currently experiencing, the government seems to have produced a satisfactory budget. To provide relief to people, a large number of whom have long been suffering due to increasing inflation, there is no new tax in the budget and there will be no tax on coronavirus and cancer diagnosis kits while the import duties on children’s food supplements and diet food have already been abolished.
However, there has been no increase in salaries and pensions of government servants — for the first time in years.
Muhammad Nasir
Karachi
Published in The Express Tribune, July 4th, 2020.
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