Pakistan has recorded a fiscal surplus of Rs1.274 trillion during the first quarter of the financial year 2026-27, extending its positive first-quarter budget balance to three consecutive years. The latest figures cover July to September 2026 and show a fiscal surplus equivalent to 0.9 per cent of gross domestic product (GDP).
The country’s primary surplus reached Rs2.974 trillion, or 2.1 per cent of GDP, during the same period. The reported fiscal performance exceeded the government’s first-quarter budget target by Rs239 billion, representing an improvement of 8.7 per cent.
Pakistan Maintains Three-Year First-Quarter Fiscal Surplus
The latest figures mark a change from Pakistan’s previous pattern of first-quarter fiscal deficits, which continued for 23 years before the recent three-year period of surpluses.
Pakistan recorded a fiscal surplus of Rs1.896 trillion in the first quarter of FY25, followed by Rs2.119 trillion in the corresponding period of FY26. The surplus for the first quarter of FY27 stood at Rs1.274 trillion.
Although the latest amount was lower than the surpluses recorded in the previous two financial years, Pakistan maintained a positive budget balance for the third consecutive first quarter.
The data also showed that the country recorded its three highest first-quarter primary surpluses in nominal rupee terms during the past 26 years, with each exceeding Rs2.9 trillion.
Primary Surplus and Fiscal Deficit Explained
A fiscal surplus occurs when government revenue exceeds total expenditure during a particular period. A primary surplus measures the difference between government revenue and expenditure after excluding interest payments on public debt.
The government’s annual fiscal position also improved during FY26. According to the reported figures, Pakistan’s fiscal deficit declined to 2.6 per cent of GDP, the lowest level recorded in 22 years.
Pakistan also achieved an annual primary surplus of 2.9 per cent of GDP during FY26, the highest level recorded since at least FY01. This marked the third consecutive financial year of an annual primary surplus, following FY24 and FY25.
Tax Collections Exceed First-Quarter Target
Tax collections during July to September FY27 exceeded the government’s target for the quarter despite tax relief measures introduced in the federal budget. However, the reported figures did not specify the total amount collected or the margin by which collections surpassed the target.
The government attributed its fiscal performance to expenditure management and improved revenue collection. These factors contributed to the reported surplus during the first quarter.
Fiscal Surplus Highlights Pakistan’s Debt Management Efforts
Continued fiscal and primary surpluses can help reduce the government’s borrowing requirements and support public debt management. The government has linked its fiscal strategy with improved international financial credibility and sustainable economic growth.
However, the first-quarter FY27 surplus was lower than the corresponding figures for the previous two financial years. The latest data therefore show that while Pakistan maintained a positive fiscal balance, the size of the surplus declined compared with FY25 and FY26.
