The Budget 2023-2024 was presented under constraints coming from all directions, and posed an almost insoluble problem for the Finance Minister. The Budget had to avoid going beyond the IMF’s constraints, but it had to be an election year Budget, with something being given to everyone. It also came against a background of abysmally low growth, of 0.39 percent, and abnormally high inflation, 31 percent, which meant that the country was in a stagflationary trough. That the stagflation is to continue was clear from the National Economic Council’s setting of targets of 3.5 percent growth and 21 percent inflation for the coming year. Senator Dar’s blaming the PTI government for the situation is wearing thin, now that the current coalition presents its second Budget.
The focus on election spending showed that there was still some hope that elections would take place, to all four provincial and national assemblies, with the funds for polls now available It might be remembered that elections to the Punjab and KP Assemblies could not be held, and the Election Commission made much of the fact that it did not have the money for the exercise. Apart from the mechanics of funding the election, the government has already placed emphasis on it by spending on the electorate. There is the most direct transfer is to grant a 30 percent increase in salaries and pensions, and then there are the goodies to be doled out under various schemes being launched in the Budget. It would perhaps be going too far to say that the elections are inevitable, but some of the more important barriers seem to have been removed.
The real question about the Budget is whether it is likely to take the country out of the stagflationary trap, and into the sort of high-growth trajectory that the country needs. That is unlikely, but blaming the rupee devaluation, or the IMF< will not change the reality, that Senator Dar, whose sponsors expected much of him when he was brought in last year, is less than a signal success, and has not fulfilled the task he was assigned: preparing the PML(N) for a successful election campaign. The Budget he has produced, his sixth, will probably not allow him to claim he has succeeded, as any election campaign by the PML(N) will take place in a gloomy economic atmosphere in which it will be trying to paper over the cracks Senator Dar has left, and rather than boasting of his performance, will be trying to draw attention from it.