ISLAMABAD, Oct 10: There will be no negative financial impact of the devastating earthquake on the budget and the government will achieve its 3.8 per cent GDP fiscal deficit target set for 2005-06, claimed a senior government official.

“In absolute numbers our Rs285 billion fiscal deficit, which is 3.8 per cent of GDP, will be achieved without any serious problem,” said Economic Adviser to the Ministry of Finance Dr Ashfaque Hasan Khan.

He told Dawn on Monday that the additional expenditure being incurred on quake relief effort will be met from the budget. The government has so far announced Rs5 billion for the earthquake victims and that some more money could be made available in this behalf, he said.

“Hopefully there will also be no problem in achieving growth targets set for the current financial year,” said the economic adviser, who is also the Director General of the Debt Coordination Office.

Responding to a question, he said that the CBR will achieve 17 per cent increase in revenue collection during the current financial year. “The CBR has performed well in the first quarter of 2005-06, indicating that we will manage more resources which could be sufficient to meet any unforeseen additional expenditure,” he added.

He said that the World Bank had offered additional financial assistance to rehabilitate Pakistan’s infrastructure that had suffered devastation by Saturday’s earthquake.

Dr Khan said he had met the World Bank mission on Monday, which is currently on a visit to Pakistan for assessing the overall infrastructure requirements. He said the mission expressed its willingness to offer additional funding for the worst-hit areas of Azad Kashmir, the NWFP and other parts of the country.

The additional funding of the World Bank, he added, could be utilized for repairing roads and government buildings, including schools and hospitals in Azad Kashmir and the Hazara division of NWFP.

The World Bank and the Asian Development Bank have so far pledged $20 million and $10 million, respectively, to help the quake victims and for meeting other emergency requirements.

He said the World Bank had already increased its annual assistance from $800 million to $1.5 billion for improving the country’s weak infrastructure. “Now it depends on us to seek assistance for viable infrastructure development projects,” he said.