Budget fever has gripped the federal and provincial capitals earlier than normal. The federal budget for the financial year 2017-18, last of the present ruling party, is going to be presented in the National Assembly on May 26, instead in first or second week of June as has been the long old tradition, due to fast approaching holy month of fasting.

Accordingly, brisk preparations are being made, budgetary proposals formulated, considered and approved and targets are being set for economic growth, fiscal deficit, balance of payments, foreign reserves etc.

It is good to note that the federal government while fixing targets and deciding on its priorities and considering measures to provide relief to various segments of the society is keeping the public informed to the maximum possible so that the people have some ideas before hand as to what they are going to get or loose in the upcoming federal budget.

The federal cabinet in its special meeting last week, meeting under chairmanship of Prime Minister Mian Muhammad Nawaz Sharif, has reviewed overall prevailing economic situation, considered and approved the Budget Strategy Paper2017-20 and set the targets for achieving for financial year 2017-18.

Most importantly, economic growth target for the next fiscal has been fixed at 6 per cent as against 5.7 per cent for the outgoing financial year. This 5.7 per cent growth rate may not be achieved and the pace of increase in national output is expected to remain around 5.4 per cent. The government would be making concerted efforts for achieving the target for economic growth and at the same time enhance the efforts to increase revenue generation.

It is pertinent to mention here that this will be for the first time, after more than two decades, that Pakistan will be achieving a 5 per cent growth rate without any external aid or war related inflows. Achievement of 7 per cent economic growth rate, official sources maintained on being contacted, that Pakistan had achieved during the last decade was the result of foreign aid flows more than anything else.

Likewise, budget deficit target has been fixed at 3.8 per cent of Gross Domestic Product (GDP) against revised target of 4.1 per cent of GDP for fiscal year 2017. The budget deficit which stood at somewhat higher at 8.2 per cent of the GDP in FY 2013 when the present took over reigns of power had been brought down to 4.66 per cent in FY 2016. The federal fiscal deficit will be brought down to 4 per cent of the GDP by June 2020, according to the new definition of the Fiscal Responsibility and Debt Limitations Act.

The total outlay of the new federal budget may be in the range of Rs 4.6 trillion to Rs 4.8 trillion against outlay of 4.385 trillion for the current financial year.

The federal budget mainly comprises development and non-development expenditures under various heads and is financed through tax collection , both direct and indirect ones, by the Federal Bureau of Revenue. Higher the tax collection means gap between the income and expenditure to be on the lower side but if the tax collection is less than what was initially projected then there is every possibility of either next axles and levies be imposed or adjustments be in the existing tax structure in the Finance Bill.

Against this year’s target of Rs 3.621 trillion tax collection, the FBR has been given higher tax collection target of Rs 4.00 trillion for the next financial year.

For financing the Public Sector Development Programme (PSDP) which reflects the federal government priorities on the development side.

For PSDP 2017-18, an allocation of Rs 700 billion has been proposed and another Rs 150 billion will be for rehabilitation of war affected areas and the Prime Minister’s Special Programmes. The PSDP size may be revised somewhat upward prior to the announcement of the federal budget and at the important forum of the National Economic Council (NEC) which will be meeting in net =few days to approve the budget and development programme as the prime minister is reported to be keen to have PSDP size in four figures around Rs 1000 billion.

More imports as compared to the country’s exports and thus trade deficit remains a big problem for the economic team of the prime minister. Country’s exports have come to around 20 billion dollars during last couple of years from 25 billion dollars and the continued downward trend is signaling alarm bells for all concerned in the corridors of power.

The prime minister sometime back had announced Rs 150 billion export package for stemming the declining trend and increasing exports. But it seems that there is something very wrong in the utilization of the export package though the same was duly hailed by the exporters. This needs to be probed as to why the export package has not been able to produce desired results and ensure appreciable increase in the country’s exports.

While declining exports trend is quite worrisome, one may ask the exporters what they are doing to shoulder their onerous responsibility of taking the country’s exports to new heights? This is also to ask, what our foreign missions are doing in this regard?

While approving the Budget Strategy Paper, the special meeting of the federal cabinet somehow did not fix target for exports though it dilated on curtailing imports by adopting new measures in the upcoming budget to curb unnecessary imports which are adversely affecting Pakistan’s external sector. In order to bring down imports reasonably low to improve the trade balance, the federal government may increase customs duties rates and also expand the list of luxury items and accordingly increasing duties on these items.

Besides declining trends, slowing down of remittances by millions of Pakistanis working in foreign countries around the world is also a matter of great concern. It is a matter of deep thinking as why the remittances are going down while more and more Pakistanis are going abroad every day and month in different parts of the country.

Pakistan’s foreign missions, whose performance in most cases leaves much to be desired unfortunately, should be directed to hold periodic meetings with Overseas Pakistanis, ascertain their problems and motivate them to use formal channels of remitting their income to their families back home and ensure facilitating them in this regard to the maximum extent possible. Our foreign missions can play an important role provided they are pulled up and told in very plain words either to deliver or comeback home. It seems that our foreign missions mostly have no regular contacts with the Overseas Pakistanis somehow.

The focus of the federal budget for financial year 2017-18, as desired by the prime minister, will be on achieving higher, sustainable and inclusive growth besides generating additional employment opportunities and increasing investments in both human and physical infrastructures. All this is quite appreciable and encouraging as everyone wants to see Pakistan making progress and development by leaps and bounds.

Needless to emphatically point out that the targets on economic front or otherwise should be kept quite realistic and doables. These realistic targets may look on the low side somewhat but at the end of the financial year, the people can swallow bitter pill if somehow these are not achieved due to various factors. But highly exaggerated targets, for political and other purposes, are obviously not achievable and thus obviously cause lot of disappointment and negative image of the government in the minds of the people. So, it is always good to remain on the ground, take stock of everything and fix the targets in quite realistic manner.

But for achieving the set targets much will depend on how much the targets fixed are realistic, achievable and based on ground realities, exports are boosted, imports curtailed and consumption of imported oil products kept considerably low. Merely fixing impressive looking targets is not enough. Everyone from top to bottom has to work really and efficiently hard to ensure these are achieved also.