Page 76 - CMA Journal (Mar-Apr 2026)

Huzaima Bukhari Dr. Ikramul Haq Abdul Rauf Shakoori

Fiscal discipline is not just an accounting exercise. It shapes The primary balance also moved into surplus and improved
macroeconomic stability, in uences investment decisions, further in FY 2024–25. These numbers matter, but they
and determines how far the state can nance its obligations should not be mistaken for a structural transformation.
without repeatedly shifting the burden onto the same The primary balance may have improved, yet the overall
documented segments of the economy.
scal de cit remains large. That gap tells its own story: the
A credible scal framework rests on balance: the state must present consolidation is being achieved more through
raise enough revenue to nance essential services and compression, deferral and temporary adjustments than
development, but it must do so without punishing through durable reform.
productive activity or deepening distortions in the economy.
It is tempting to describe Pakistan's scal de cit as a simple
Pakistan has long lived with scal imbalances, often severe revenue problem. It is not. The deeper causes lie in the
enough to affect the primary balance as well. FY 2023–24 did continuing losses of state-owned enterprises, chronic
show some consolidation: the scal de cit fell to 6.9% of inefficiencies in the energy sector, large tax expenditures,
GDP, down from 7.8% in FY 2022–23 and 7.9% in FY 2021–22. weak institutional coordination, and the repeated failure to
undertake sustained structural reform.

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