ISLAMABAD: Pakistan recorded a fiscal surplus of Rs1.274 trillion, equal to 0.9 percent of GDP, in the first quarter (July to September) of the current fiscal year 2026-27, Adviser to the Finance Minister Khurram Schehzad announced on Friday.
The primary balance, which leaves out interest payments on debt, showed a surplus of Rs2.974 trillion, or 2.1 percent of GDP. Mr Schehzad said this was Rs239 billion, or 8.7 percent, better than the budget target for the quarter. He added that tax collection in the first three months beat its target even though the FY2027 budget offered some tax relief, and that government spending stayed under control.
Describing the trend, the adviser said Pakistan’s fiscal performance was now marked by sustained financial discipline rather than one-off gains.
Background
According to the figures shared by the adviser, this is the third fiscal year in a row that Pakistan has closed the first quarter in surplus. For 23 straight years before that, from 2002 to 2024, the July-September quarter always ended in deficit. The first-quarter surplus stood at Rs1.896 trillion in FY2025 and Rs2.119 trillion in FY2026, so this year’s overall figure is smaller than last year’s, while the primary surplus remains above Rs2.9 trillion for a third straight year, the highest first-quarter levels in 26 years.
For the full fiscal year 2025-26, the government reported a fiscal deficit of 2.6 percent of GDP, the lowest in 22 years, and a primary surplus of 2.9 percent of GDP. Interest spending fell by 22 percent over that year, and the country has now posted a primary surplus in three consecutive full years, from FY2024 to FY2026. The adviser shared the latest quarterly numbers in a post on X, presenting them as evidence that the gains of the past two years are holding. Readers can learn more about how revenue and spending targets are set in our explainer, How Pakistan’s Budget Works.
What This Means for You
A surplus means the government took in more money than it spent during the quarter, including what it paid in interest on its debt. To put the size in perspective, Rs1.274 trillion works out to roughly Rs5,300 for each of Pakistan’s 241.5 million people counted in the 2023 census. When the government spends within its means, it has less need to borrow, and money not spent on interest can go to development projects and relief measures instead.
The full-year picture will become clearer as the Finance Ministry releases fiscal data for the remaining quarters of 2026-27.
Sources: Ministry of Finance, Radio Pakistan
Featured image: Photo: Usman.pg / Wikimedia Commons, CC BY-SA 3.0
