01-04-2010, 02:47 PM
Hi Toronto Boy,
Deficit planning is only good if it is managed in certain parameters. Generally it is 2% to 3% of GDP. No doubt deficit planning help economies grow and ignite economic activities. However, in Pakistani prospective, Govt over runs the limited which has caused inflation to grow more than 20% as per CIA Report of Facts, WB & IMF. Food inflation is even higher. I don't think that deficit planning is the only reason for such high inflation. In fact corruption is also a major factor.
Deficit planning is only good if it is managed in certain parameters. Generally it is 2% to 3% of GDP. No doubt deficit planning help economies grow and ignite economic activities. However, in Pakistani prospective, Govt over runs the limited which has caused inflation to grow more than 20% as per CIA Report of Facts, WB & IMF. Food inflation is even higher. I don't think that deficit planning is the only reason for such high inflation. In fact corruption is also a major factor.
