There is no denying Governor State Bank of Pakistan Shahid Kardars note of caution to the federal set-up that it must curtail its borrowing from the central bank. On account of the overall fiscal pressure the economy is facing, it is pretty clear that the governments unchecked borrowing is only aggravating the situation by speeding up the inflationary spiral. Mr Kardar also rightly stated that the share of the private sector so far as credit expansion was concerned needed to be increased as it was crucial for economic growth. But when the government takes away the lions share of the credit from the central bank, there would be much less left for the private sector to borrow. At the end of the day it will be the business community and genuine entrepreneurs who would suffer. It is little wonder that because of governments reliance on the SBP, the fiscal deficit as revealed by the Ministry of Finance has risen to 4.5 percent of the GDP. He also disclosed that the governments expenditure increased by 13.2 percent of the GDP, which is quite shocking. In the first place these figures fly in the face of the PPP governments own commitment made to the IMF as well as the general public that it will cut down its expenditure and would consequently bring down the borrowing from the central bank to zero. On the other hand, the governments constant pressure on the SBP to print extra currency notes in order to meet its expenses is also having a negative impact on the banks annual profits, which is a cause for serious concern. The governments fiscal indiscipline not only reflects poorly on its commitment to adopt austerity measures, but also shows its failure to generate sufficient revenues through proper channel that includes bringing the untapped sectors of economy into the tax net. The current fiscal situation is, of course, going to cause problems for the next budget.