ISLAMABAD: Finance Minister Ishaq Dar defended his government’s decision to propose an allocation of Rs950 billion and Rs200 billion from the Public and Private Partnership mode a total of Rs1,150 billion in his seventh post-budget presser on Saturday, terming it a “new high".

During the presser, Dar said: “I believe that if we implement this Public Sector Development Programme (PSDP) an important public intervention to spur private investment by developing human capital and improving the country's infrastructure] in letter and spirit and with transparency, we will be able to easily achieve the 3.5% growth.”

In the budget revealed yesterday, about Rs950 billion were earmarked for vote-winning development projects ahead of a general election later this year, while other populist measures include civil service pay rises of up to 35%, and a 17.5% increase for state pensions.

The government presented the federal budget for the next fiscal year, one of three measures the International Monetary Fund (IMF) will gauge before releasing at least some of the $2.5 billion still pending under a lending programme expiring this month.

The cash-strapped country, with reserves to barely meet a month's worth of imports, is undertaking steps to secure a $1.1 billion loan, part of a $6.5 billion IMF bailout package, which has been delayed since November, with more than 100 days gone since the last staff-level mission to Pakistan — the longest such delay since at least 2008.

Pakistan is eyeing a Gross Domestic Product (GDP) growth of 3.5%, expecting inflation at 21%, and targeting a fiscal deficit of 6.54% of GDP for the 2023-24 fiscal year, slightly below the current year's revised estimate of 7%.

In the budget, about Rs950 billion were earmarked for vote-winning development projects ahead of a general election later this year, while other populist measures include civil service pay rises of up to 35% and a 17.5% increase for state pensions.

During the presser, the finance minister slammed the Pakistan Tehreek-e-Insaf-led government — which was ousted in April 2022 — for increasing the country’s debt.

“A large sum in this budget will also go into [paying] loans,” he said.

However, he said that if the budget targets are met, the country's economy will grow.

“If there is growth, then the wheel of the country will turn smoothly,” the minister said.

FinMin Dar said the government has set aside budget for health, education, social sector, and transport in the Public Sector Development Program (PSDP) — an important public intervention to spur private investment by developing human capital and improving the country's infrastructure.

He mentioned that the development budget of provinces is Rs1,559 billion, while the federal government’s development budget is Rs1,150 billion — Rs950 billion from the government and Rs200 billion from PPP mode.

Defending his government’s move, Dar said: “I believe that if we implement this PSDP in letter and spirit and with transparency, we will be able to easily achieve the 3.5% growth,” Finance Minister Dar said.

He further announced that two committees will be set up in the Federal Board of Revenue (FBR) — one related to business and the other to address technical issues and anomalies.

The finance minister said he will give approval for the committees to the FBR chairman soon and they will be effective from Monday.

He further added that these committees will work till the day before the budget is wrapped up.