Pakistan, under IMF bailout, sets 4.8% GDP growth target

Pakistan, in talks with the IMF about its $6 billion bailout programme, set a growth target at 4.8% of GDP for the 2021-22 financial year and a fiscal deficit target of 6.3% on Friday.

Finance Minister Shaukat Tarin included the goals as he set out Pakistan's annual budget before parliament, with a total spending outlay of 8.4 trillion rupees ($53.93 billion).

Pakistan, which borders India, Afghanistan and Iran, surpassed growth projections in the 2020-21 financial year despite a third wave of Covid-19 infections, with GDP growth of 3.96%, against a target of 2.1%.

"We want to make sure of a growth rate of 6% to 7% in the next two to three years," Tarin told members of parliament, including Prime Minister Imran Khan. "We have gotten successfully on the path from stabilisation to growth."

Pakistan's economy contracted 0.47% in 2019-20.

Tarin's speech was interrupted by opposition MPs protesting at the economic performance of Khan's government.

Tarin said Pakistan would set a target of 5.8 trillion rupees ($37.24 billion) in revenue collection for the next financial year, with about 2 trillion rupees in non-tax revenue.

Pakistan is in talks with the IMF as part of the sixth review of a 39-month bailout programme, which began in 2019.

The revenue target has been a key topic and Tarin has said the IMF and the government debated ways to achieve the target, which is 23% higher than the current year's expected collection.

The budget document shared with Reuters said one of the main objectives was to pursue the IMF programme, even as Pakistan has said it is looking for the easing of some restructuring targets.