The Pakistani federal government announced the 2024–25 budget on Wednesday. Finance Minister Muhammad Aurangzeb gave the speech. There was a lot of discussion during the budget session in the National Assembly. Several economic experts gave their opinions on the proposed measures. The budget sets a high goal of Rs13 trillion in tax collections and a GDP growth rate of 3.6%. Here are the most important points and what experts think about the budget.
Key Highlights of the Budget
The total budget spending is Rs18.9 trillion, 30% more than the previous year. The government wants the budget deficit to decrease to 6.9% of GDP. Some key allocations are:
- Defense: Rs2.122 trillion, which is 14.99% more than last year.
- Energy Sector: Rs253 billion for development projects, consisting of Rs65 billion to improve electricity distribution.
- BISP: The Benazir Income Support Program budget went up by 27% to Rs593 billion.
There are also plans not to charge import taxes on solar panel equipment and to lower the cost of pensions for government workers through new programs.
Expert Opinions
The budget was a “lost opportunity,” according to Miftah Ismail, a finance minister. He said there needed to be more big changes, and manufacturers and exporters had to do too much. Ismail said that the sales tax hike would increase prices and that taking away tax breaks for exporters could hurt the economy.
A senior reporter for Dawn named Nasir Jamal was shocked when the government tried to tax the real estate market and keep records on the retail sector. It was pointed out that these steps are a good start, but the real problem is making sure they are followed.
A business reporter named Khurram Husain didn’t see many efforts to change things in the budget. He stressed that bigger changes were needed, especially removing tax breaks.
Dr. Shumail Dawood, who used to be president of the Rawalpindi Chamber of Commerce and Industry, thought the budget was good. He talked about how the government works to make the economy more market-based and efficient using technology.
Ali Hasnain is an associate professor of economics at LUMS. He liked that the budget took some positive steps, but he warned about the ongoing debt crisis. To fix the country’s long-standing economic problems, he called for a budget that would cause more trouble.
Maha Rehman, an economist, liked that the tax net grew and that the focus was on digitization. However, she stressed the importance of supporting the IT sector by building the right infrastructure and human capital.
Business and Industry Reactions
There were mixed reactions from business leaders. The Karachi Chamber of Commerce and Industry (KCCI) said the budget was bad for business and more aligned with IMF rules. They were worried about how much more it would cost to do business now that taxes and excise duties were increasing.
The Lahore Chamber of Commerce and Industry (LCCI) liked some measures that helped businesses, but they warned that some tax changes could slow down the economy. They wanted to talk with more people about the budget before finalizing the measures.
Conclusion
Experts and business leaders have different things to say about the federal budget for 2024–25. Some people see steps in the right direction toward economic growth and stability. In contrast, others complain that there aren’t enough substantial reforms and that manufacturers and exporters may have to deal with extra costs. The real effects of this budget will become clear in the coming months as Pakistan deals with its economic problems.
