In the report released on Thursday, the SBP said, ” the budget deficit for the first quarter 2011-12 was 1.2 percent of GDP, compared with 1.5 percent during the same quarter last year.”
“This reduction in the budget deficit was caused primarily by 29.7 percent growth in FBR revenues, on the back of increased tax collection efforts and higher revenues from imports.” the central bank said, “Non-tax revenues also recorded impressive growth of 50.4percent,” it added.
However, the amount collected by FBR up to end Dec 2011, falls short of amount needed to meet the annual target of Rs. 1,952.3 billion, it said, adding that meeting end year revenue targets would also depends upon the realization of CSF and sale of 3G licenses (around 150 billion) in absence of which, it would be difficult for the government to contain the fiscal deficit within its annual target.
The government has been making some headway towards improving its finances, the report also mentioned.
The SBP said the Gross Domestic Product (GDP) growth target of 4.2 percent for 2011-12 GDP looks difficult due to the host of factors that include, among others, gas shortage, high oil prices and decline in global prices of agricultural commodities.