KARACHI, June 25: The government has projected the State Bank profit at Rs26 billion for fiscal year July/June 2002-03.

The federal budget documents show this projected profit as part of the non-tax revenue of about Rs154 billion that the government hopes to raise in the next fiscal year. Other components of non-tax revenue include the profit of the state-run Civil Aviation Authority and earnings from a wide range of state- sponsored activities.

The budget documents estimate that the central bank would end up earning a net profit of Rs26 billion also in the current fiscal year—up Rs3 billion from the initial budget estimate of Rs23 billion.

Central bankers say what may enable the SBP to post a higher profit this year is its earning on foreign exchange transaction but they would not say whether the central bank would actually post Rs26 billion profit. In fiscal 2000-01 the central bank was able to post a net profit of Rs21 billion but despite reporting a huge loss of Rs49 billion on foreign exchange transactions.

“This year the situation has changed mainly due to the huge gain the rupee has made against the US dollar,” said a senior central banker.

The rupee has appreciated by about 6.25 per cent during this fiscal year: In the last fiscal it had rather depreciated by a big 18.6 per cent. “That really makes a difference when it comes to making money through foreign exchange dealings,” said the central banker.