ISLAMABAD - Political constraints together with increasing costs of war against terror and IMF pressure, the PPP-led ruling coalition appears to have left with very little fiscal space to present a people-friendly budget for the fiscal year 2011-12 today (Friday). The government economic team headed by Finance Minister Dr Abdul Hafeez Sheikh remained busy till late Thursday night in giving final touches to the budget proposals that would be put up before the federal cabinet for approval and later in the National Assembly. Although government sources claimed that the proposed budget would be growth-oriented with more focus on key targets including stabilising economy, employment generation, broadening tax base and relief to the common people, opposition remains unenthusiastic about these claims. Independent economists believed the government would not be able to cap the yawning budget deficit as a result measures proposed by the government would give further rise to inflation. Similarly, they believed the government would not be able to set a realistic revenue target to avoid political ramifications thus the projection was likely to be more inflated and unattainable that would lead to mini budgets in due course of time. The government plans to give special relief to the unemployed youth by offering them soft loans up to 500,000 rupees besides increasing pays and pensions of the government employees to show that budget was people-friendly. Although the government plans to bring more than 700,000 people into the tax net, many believed it would not be possible for the government to take on mighty tax evaders largely because of the political consideration. They cited the case of agriculture tax issue saying the government had already referred the matter to the Council of Common Interest (CCI) in a bid to sideline the issue because of the opposition by the powerful agriculture lobby. This they thought had also killed the hopes of any viable additional resource generation measure to tackle the major fiscal challenges facing the country. Given that Pakistan is deeply involved in fighting insurgency, therefore, related costs would continue increasing during the next fiscal year, leaving little prospects for new investment in the country due to the given situation. Similarly, the government is compelled to tackle the energy crises in the country and to meet shortages would embark on ambitious plans to overcome this problem, thus leaving very little space for major development projects in other fields. According to unofficial budget documents, the consolidated outlay of the next year budget is likely to be Rs 3.8 trillion whereas revenue target is estimated at about Rs 1.9 trillion. Official sources claimed the budget envisages in addressing the issues of energy generation, social sector development and revenue enhancement besides major reforms will be introduced for improving governance and boost private sector investment. Amid domestic and international challenges, the realistic GDP growth target will be 4.2 per cent against 2.4 per cent GDP growth in the outgoing year which was projected at 4.5 per cent. Although official sources claimed that the proposed budget would also offer lower interest rates on loans from the banks, independent economist believed such measures would add to further inflation. According to official sources, the growth in FY 2011-12 would base primarily on revitalising the industrial sector by curtailing energy shortages and high interest rates that are presently discouraging the private sector from investing. This year, the budget will also focus on infrastructure, human capital, promotion of investments and exports and agriculture sector development. Emphasis will also be made on normalising agriculture activity and maintaining good performance in services sector.