Finance Ministry rules out mid-year budget adjustments, cites positive economic indicators

The Finance Ministry has ruled out any mid-year adjustments to the federal budget, asserting that current economic indicators demonstrate the effectiveness of the government’s fiscal policies. 

As per news reports, the ministry addressed recent media reports suggesting economic instability and alleged inaccuracies in the IMF’s $7 billion support package. 

It dismissed these concerns as speculative, stressing that the claims about inflation, LSM growth, and import targets are based on incomplete or misinterpreted data. The ministry advised caution against misleading information, reiterating its commitment to transparency and alignment with published economic goals.

The ministry underscored that inflation, large-scale manufacturing (LSM) growth, and import trends are in line with government projections, negating any need for immediate changes.

The consumer price index-based inflation for the first quarter was recorded at 9.2%, lower than the government’s initial projection of 10.2%. 

The IMF, likewise, adjusted its inflation forecast for 2024 downwards, from 12.7% to 9.5%.

In terms of LSM, the ministry noted that July’s growth rate surpassed expectations, reaching 2.52%, although a temporary dip occurred in August. 

The textile and automobile sectors showed signs of recovery and growth, respectively, after challenging periods. 

The ministry expressed confidence that the LSM sector’s performance is in alignment with economic objectives, contributing to revenue generation and stability.

The Finance Ministry also reported that the actual import volume for the first quarter stood at $14.219 billion, slightly above the estimated $14.062 billion. This increase is attributed to the need for imported goods to support manufacturing and production recovery. The IMF has revised its annual import forecast for Pakistan to $57.2 billion, closer to the government’s projection of $57.3 billion.