PTI government plan for generating Rs 4.92 trillion through sales of treasury bills and bonds
The government is planning to raise Rs. 4.92 trillion through the sale of treasury bills and bonds till the end of April 2021 in order to fill in the budget gap.
The SBP will hold fortnightly auctions for 3, 6, and 12-month Market Treasury Bills between February and April, with a total target of Rs. 4.3 trillion for the six auctions.
The central bank revealed plans to sell fixed-rate Pakistan Investment Bonds (PIBs) of 3, 5, 10, 15, 20, and 30-year terms, worth Rs. 350 billion. This will be coupled with floating rate PIBs of 3, 5, and 10 years, worth Rs. 180 billion. ------------------------------
Additionally, the SBP also shared plans of auctioning two-year floating-rate PIBs worth Rs. 90 billion in the period under review.
The government has issued an auction calendar for the government of Pakistan Ijara Sukuk. However, it has not set a target for the three fixed rental rate and variable rental rate Ijara Sukuk, reported a national daily.
The Ministry of Finance is working on new assets to issue this potential Sukuk. So, for now, the government has kept the Sukuk auctions open.
However, this domestic borrowing will depend upon tax collection by the government. If the government manages to meet the revenue targets through tax revenues, then the need for borrowing from banks will be reduced, and so would the issuance of this debt. ------------------------------
Until January 2021 end, the Federal Board of Revenue (FBR) managed to surpass the monthly target of Rs. 341 billion, by collecting Rs. 363 billion. The total revenue collection for seven months (July 2020 to January 2021) by the FBR has also been above the initial target by Rs. 17 billion.
The FBR collected Rs. 2.568 trillion against the initial target of Rs. 2.551 trillion.