ISLAMABAD: The presentation of Pakistan’s Federal Budget 2025-26 has been postponed from June 2 to June 10 due to disagreements between the Finance Ministry and the International Monetary Fund (IMF) over key budget figures, including subsidy allocations.
During a session of the National Assembly’s Standing Committee on Commerce, chaired by Khurshid Ahmed Junejo, Joint Secretary (Corporate Finance) Sajjad Azhar highlighted the ongoing challenges in finalizing the budget numbers. The delay reflects difficulties in reconciling Pakistan’s figures with IMF requirements under the Extended Fund Facility program, which restricts changes to allocated funds.
One major point of contention is the outstanding receivables owed to the Trading Corporation of Pakistan (TCP), totaling around Rs 317.5 billion. This includes Rs 93.693 billion in principal and Rs 223.797 billion in accrued markup. TCP Chairman Syed Rafeo Bashir Shah emphasized that TCP’s distribution of imported wheat and urea followed Economic Coordination Committee directives, yet payments have been pending since 2010.
However, the Finance Ministry contends that the ECC never approved subsidy coverage for markup costs. Multiple meetings with stakeholders and the State Bank of Pakistan (SBP) have failed to secure relief from commercial banks, as these are considered commercial agreements.
The National Assembly panel urged increasing subsidies to enable partial payments to TCP. Azhar noted recent commercial loans secured for Pakistan International Airlines and plans to address circular debt borrowing at KIBOR minus 0.2 percent, with details to be submitted to the federal cabinet.
Additionally, the Punjab government has pledged Rs 26 billion, matched by federal contributions next fiscal year. Rs 15 billion is expected for TCP on behalf of Utility Stores Corporation and National Fertilizer Marketing Limited, while Rs 30 billion will be allocated in the upcoming budget.
Following discussions, the panel agreed to release Rs 90 billion in the first phase to TCP and conduct a special audit of its commercial loans. Members called for swift resolution of outstanding markup payments.
