As of August 5, 2025, Pakistan’s budget deficit for fiscal year 2024-25 (FY25), which ends in June 2025, stands at Rs 6.16 trillion, equivalent to 5.4% of GDP. This reflects a significant improvement compared to the previous fiscal year, FY24, when the deficit reached Rs 7.2 trillion, or 6.8% of GDP. However, the statistical discrepancy representing the gap between reported income and expenditure due to differing data collection methods increased to Rs 0.32 trillion from Rs 0.17 trillion, highlighting ongoing challenges in reconciling financial data.
The Ministry of Finance reports gross revenue receipts of Rs 16.8 trillion, with net revenue totalling Rs 9.94 trillion after transferring Rs 6.85 trillion to the provinces. Total revenues reached Rs 17.997 trillion, with Rs 12.722 trillion generated from taxes, of which the Federal Board of Revenue collected Rs 11.744 trillion, and Rs 5.27 trillion from non-tax sources. Provincial collections further contributed Rs 0.97 trillion.
Pakistan Fiscal Operations – FY25
• In FY25, the total budget deficit reached PKR 6,168bn (5.4% of GDP).
• Pakistan's budget deficit for 4QFY25 stood at PKR 3,198bn (2.8% of GDP).
• In FY25, FBR revenue stood at PKR 11,744bn, +26%YoY.
• The budget deficit as a… pic.twitter.com/dgjGhdChdT
— Arif Habib Limited (@ArifHabibLtd) August 5, 2025Total expenditure climbed to Rs 24.16 trillion, with current expenditures accounting for Rs 21.52 trillion. Debt servicing emerged as the largest expense at Rs 8.88 trillion, composed of Rs 7.8 trillion in domestic debt and Rs 0.89 trillion in external debt, leaving Rs 1.1 trillion remaining. Defence spending totalled Rs 2.193 trillion, with nearly 50% of its funding derived from borrowed resources.
The government also relied on Rs 4 trillion in borrowing to cover pensions, civil government operations, subsidies, and grants. Public Sector Development Programme (PSDP) expenditures, amounting to Rs 1.048 trillion, were similarly financed through borrowing.
The federal government posted a budget deficit of Rs 7.08 trillion, along with a statistical discrepancy of Rs 0.19 trillion. The primary balance, which excludes debt servicing, recorded a surplus of Rs 2.7 trillion, or 2.4% of GDP. These figures demonstrate the government’s commitment to fiscal discipline despite significant borrowing. Nevertheless, the heavy reliance on loans for defence and development underscores the persistent financial pressures Pakistan faces.
