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Business Recorder
5 days ago
- Business
- Business Recorder
Punjab budget reflects deliberate realignment of fiscal priorities?
LAHORE: The structure of the Punjab budget for FY 2025–26 reflects a deliberate and disciplined realignment of fiscal priorities. While curtailing non-essential current expenditure, the government has expanded development spending through the largest-ever Annual Development Programme (ADP) in Punjab's history, with 47.3% increase over previous year's ADP. This expansion has been made possible through robust public financial management reforms, including but not limited to the successful retirement of unsustainable commodity operations debt. As per budget document, this year's budget reflects a strategic shift from foundational infrastructure to transformative development. While the first year focused on road connectivity and basic service delivery, FY 2025–26 marks the next logical step i.e., empowering communities through integrated urban development and rural uplift. Transport has emerged as a key priority with a focus on expanding eco-friendly public mobility options, including the introduction of electric buses to reduce urban congestion and environmental impact. The Punjab government has also placed unprecedented emphasis on education—expanding access through scholarships, laptops, school meals, and higher education grants. Health remains a cornerstone, with flagship health initiatives such as Medical City, free medicine, and new centres for cancer and cardiac care. New frontiers in IT, affordable Housing and Climate Action signal the province's ambition to build an inclusive, forward-looking economy, the budget document reveals. On the other hand, the Punjab government, in view of its rapidly increasing annual pension expense and burgeoning accrued pension liabilities accorded approval of the Defined Contribution Pension Scheme. Under the scheme, employees would be contributing for its pension contrary to the defined benefit scheme where government finances solely to the pension. This would significantly reduce the piling of accrued liability, and this has been enacted for the employees joining the government service on or after January 08, 2024. Moreover, the Punjab government has implemented the deregulation of commodity operations of wheat which previously was financed through commercial borrowing from the financial institutions. The scheme had accumulated a circular debt of Rs 629 billion outstanding at June 2022 due to unfunded general subsidy expenditure. The government has eliminated this debt from provincial revenues leading to reduction of commodity debt outstanding down to Rs 13.9 billion at April`25, which is fully backed by the wheat stock leveraging the saving of future debt service in the range of approximately Rs 50 billion per annum. Copyright Business Recorder, 2025
Express Tribune
17-06-2025
- Business
- Express Tribune
Pak-US pledge to deepen strategic, economic cooperation: FM Aurangzeb
Listen to article Federal Finance Minister Muhammad Aurangzeb stated on Tuesday that Pakistan and the United States are advancing efforts to enhance their strategic partnership and emphasised that both nations are aligning on key issues and making progress in the right directionted. Speaking at an event in Islamabad, the minister described his recent dialogue with US Commerce Secretary Howard Lutnick as encouraging and forward-looking. Aurangzeb reaffirmed the government's commitment to continuing reform initiatives in areas such as taxation, energy, and trade, according to a report on the state-run Radio Pakistan website. He noted that recent tariff adjustments are aimed at fostering a more competitive economic environment. Commenting on pension reforms, the finance minister said the introduction of the Defined Contribution Pension Scheme represents a balanced approach that benefits both the state and government employees. He added that pensions for retired personnel have been raised by seven percent to reflect current inflation trends. Additionally, a proposal has been made to impose a five percent tax on pensions exceeding ten million rupees, while ensuring that lower- and middle-income retirees remain unaffected. During a prior virtual meeting with Commerce Secretary Lutnick, both parties agreed to push forward with negotiations on reciprocal tariff arrangements. The discussions focused on increasing trade and investment ties and strengthening economic collaboration based on mutual interest. The two sides also consented to continue technical-level talks in the coming days, following a jointly agreed roadmap aimed at finalising a trade agreement. Read: Trump says Pakistani officials visiting US next week for trade talks Previously, the federal government decided to initiate talks with the Trump administration regarding the 29% tariff imposed on Pakistani products by the United States, Express News reported. Sources said that the government has begun formulating a strategy to address the impact of the additional tariff and to explore the possibility of reducing it through discussions with the US authorities. In this regard, a crucial meeting was held at the Ministry of Commerce under the chairmanship of Federal Minister for Commerce, Jam Kamal Khan. The meeting, which included over fifty key exporters, importers, and stakeholders, focused on the potential effects of the 29% tariff, particularly on Pakistan's textile exports. The session analysed how the new US tariffs could negatively impact Pakistan's textile sector, which forms the largest part of the country's exports to the US. Pakistan's average exports to the US exceed $5.5 billion annually, with textiles accounting for a significant share. Furthermore, Senator Aurangzeb, reiterated Pakistan's unwavering commitment to fostering regional economic cooperation at the Shanghai Cooperation Organization (SCO) Finance Ministers and Central Bank Governors meeting in Beijing on Tuesday. The virtual address highlighted Pakistan's ongoing dedication to advancing economic stability, prosperity, and development within the SCO framework. Senator Aurangzeb reaffirmed Pakistan's active role within the SCO, underlining its importance as a vital platform for enhancing economic ties among member states. Aurangzeb also expressed gratitude to China for hosting the high-level gathering and stressed Pakistan's support for proposals aimed at boosting joint projects, technology transfer, and capacity-building programs.
