[Pakistani Rupee To USD] How High Will Pakistani Rupee Appreciate In Exchange With US Dollars?

The deficit retained increasing fast, from 6.5 percent in 17/18 to about 9.1percent in 18/19 and 8.1percent in 19/20 (along with the deficit was 8.1percent instead of even higher because the government let circular debt increase at record levels). The record-high deficits in PTI’s two years led to the largest increase in public debt ever seen. The authorities increased gross debt by 11,444 billion in just two years (compared to Rs10,661 billion in PMLN in 5 years). Our debt to GDP has gone from 72% to 87% in two decades. Similarly, total external debt & liabilities to GDP has also increased from 33.4% in June ’18 to 45.5% in June ’20. Our entire debt and external debt ratios are now increasing at a dangerous clip. The government has also failed to increase tax collection.

Against the previous year’s goal of Rs 5555 billion, it only increased by Rs 3950 billion, although covid hindered in the group of Rs 300 to Rs400 billion. This year the goal is 4950 billion but again the trend seems to suggest Rs 4300 billion sprinkled with a miniature budget. Given the enormous devaluation, this government’s revenue collection was abysmal. In the first quarter of the past year, our budget deficit was 0.4percent of GDP. This fiscal year (20/21) can it be 1.1% of GDP so I fear we might end up with another year of more than 8 or 9% of GDP budget deficit. This enormous shortage (or dissaving) cannot be helpful for capital formation or investment. Our exports in 17/18 were $24.75 billion. They fell in PTI’s first season by $500 million despite enormous devaluation and last year decreased (in part because of Covid) by yet an additional $1.8 billion.

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