Financial crunch: Cash-strapped AJK govt can’t pay salaries
State Bank orders cheques not be cashed till further orders.
On a month-on-month basis, the trade deficit in January widened at an alarming pace of 61% compared to December. PHOTO: FILE
MUZAFFARABAD:
Facing a financial crunch, the Azad Jammu and Kashmir (AJK) government has crossed its overdraft limit by double the permissible amount, sources told The Express Tribune on Tuesday.
According to sources in the finance department, “The Azad Kashmir government has so far borrowed Rs3.64 billion against its overdraft limit of Rs1.5 billion from the State Bank of Pakistan. The main chunk of Rs3 billion has been spent on non-developmental expenditure during the last three months.
The State Bank of Pakistan’s Azad Kashmir branch has issued a circular to all financial institutions and banks across AJK to stop cashing government cheques till further orders, the sources stated.
The AJK government has already spent Rs20 billion profit earned by various departments, the sources added.
Due to the financial crisis, the AJK government is not in a position to pay salaries for the month of March, added the sources.
In AJK, more than 90 per cent of the budget is spent on non-developmental expenditure and 20 per cent is eaten up by salaries and perks of government employees. A great number of the employees are related to bureaucrats and politicians and are drawing salaries at homes without going to office.
Published in The Express Tribune, March 12th, 2014.
Facing a financial crunch, the Azad Jammu and Kashmir (AJK) government has crossed its overdraft limit by double the permissible amount, sources told The Express Tribune on Tuesday.
According to sources in the finance department, “The Azad Kashmir government has so far borrowed Rs3.64 billion against its overdraft limit of Rs1.5 billion from the State Bank of Pakistan. The main chunk of Rs3 billion has been spent on non-developmental expenditure during the last three months.
The State Bank of Pakistan’s Azad Kashmir branch has issued a circular to all financial institutions and banks across AJK to stop cashing government cheques till further orders, the sources stated.
The AJK government has already spent Rs20 billion profit earned by various departments, the sources added.
Due to the financial crisis, the AJK government is not in a position to pay salaries for the month of March, added the sources.
In AJK, more than 90 per cent of the budget is spent on non-developmental expenditure and 20 per cent is eaten up by salaries and perks of government employees. A great number of the employees are related to bureaucrats and politicians and are drawing salaries at homes without going to office.
Published in The Express Tribune, March 12th, 2014.