AKD's Budget 2026: Neo-Liberal Path & Growth Concerns 📈

• President AKD presented Budget 2026, confirming a commitment to IMF-prescribed neo-liberal economic policies (Washington Consensus principles), marking a significant policy shift from his previous stance. • Growth: Current economic expansion of around 5% is deemed insufficient for long-term prosperity, which the writer suggests requires consistent growth exceeding 9%. The medium-term growth target of 7% is considered inadequate. • Reserves: Gross Official Reserves (GOR) above US$ 6 Bn are viewed as misleading. After excluding the ~US$ 1.3 Bn Chinese Yuan SWAP facility (deemed unusable for general payments), usable GOR is closer to US$ 4.7 Bn. Net Foreign Assets (NFA) stood at only US$ 1.9 Bn (Rs 567 Bn) by end-September 2025. • Fiscal Policy: The pursuit of a Primary Account Surplus is achieved by curtailing capital expenditure and expanding the tax base. This approach is critiqued as negative for future economic growth, arguing that a Revenue Account surplus (Government savings) should be the primary goal. • Strategy: While digitalisation is the main development strategy and is deemed necessary, critics stress it is not sufficient. There is an urgent need for a concrete plan focused on real sector development to ensure sustained wealth and stability, an area only partly addressed by the Budget.