Pakistan’s GDP growth best in 10 years
[Pakistan’s] growth rate... has now risen to 5.3% and this growth is also being acknowledged at the world level
Ishaq Dar, Pakistani Finance Minister
islamabad — Despite several internal and external challenges, Pakistan’s gross domestic product recorded its highest growth in 10 years of 5.3 per cent during the outgoing fiscal year 2016-17.
“The growth rate was just three per cent in 2013, which has now risen to 5.3 per cent and this growth is also being acknowledged at the world level,” Senator Mohammad Ishaq Dar said while launching the Pakistan Economic Survey for the outgoing fiscal year in Islamabad on Thursday.
He said that the overall size of country’s economy has crossed the threshold of $300 billion during the current year, which was a healthy sign.
Keeping in view the current growth rate, the GDP growth rate target for the upcoming 2017-18 fiscal year has been fixed at six per cent, the minister said, hoping that the target would not only be achieved but exceeded.
He said that during the outgoing fiscal year, the agriculture sector posted a growth of 3.5 per cent, which was a positive sign. He attributed the growth to incentive packages announced in the last budget to farmers.
The minister said that the policy rate has been reduced to 5.75 per cent, which was at the lowest level in last 45 years.
Agriculture blooms
Dar said that cotton production grew by 7.6 per cent, wheat by 0.5 per cent, rice by 0.7 per cent, sugarcane by 4.4 per cent and maize by 16.3 per cent. The livestock sector, meanwhile, witnessed growth of 3.43 per cent, while fishing and forestry grew by 1.23 per cent and 14.49 per cent, respectively.
Dar said large-scale manufacturing grew by 5.06 per cent compared to 4.64 per cent last year.
He said the headline inflation consumer price index averaged at 4.1 per cent during July-April 2017 against a target of six per cent, showing that inflation will remain below the figure.
Dar said during the current fiscal year, Pakistan’s imports showed a rising trend at a relatively fast rate (18.7 per cent) due to increased economic activity as part of the China-Pakistan Economic Corridor project. He said that as per estimates, imports by the end of the fiscal year would remain at $45.4 billion. The finance minister said remittances reached $14.1 billion compared to $14.4 billion last year, adding that capital and financial accounts recorded a surplus of $5.1 billion, which was significantly higher than the surplus of $3.6 billion last year.
In October of fiscal year 2017, foreign exchange reserves hit an all-time high at $24.3 billion, of which net reserves with the State Bank of Pakistan were $18.93 billion, while scheduled banks had $5.10 billion.
The high level of foreign exchange reserves, a sign of economic stability, has been achieved due to deep-rooted and comprehensive foreign policies and reforms undertaken by the government.
The minister said foreign direct investments grew by 12.4 per cent and reached $1.6 billion in a ninemonth period. Pakistan has also achieved progressive and significant improvement in the overall security landscape in recent years despite conflict and continuing instability in Afghanistan.
The survey revealed that this has been accomplished largely due to successful counter-terrorism efforts of the government under the framework of comprehensive National Action Plan, backed by the extensive and highly-effective operation Zarb-e-Azb by the armed forces and actions by other security and law-enforcement agencies and intelligence-based operations across the country.
The survey showed that after successful completion of Zarb-eAzb, a country-wide operation, Radd-ul-Fasaad, has been launched for eliminating any residual or latent threats. It said due to the war in Afghanistan, Pakistan has faced the most serious consequences — from political to security, socioeconomic and environmental — over the decades.
From hosting millions of refugees to being a major victim of terrorism, the cumulative impact has been enormous, with adverse overall growth rate in all major sectors of economy, the survey said.
As per the survey, normal economic and trading activities were disrupted, resulting in higher costs of doing business, including cost of insurance and significant delays in meeting export orders around globe. As a result, Pakistani products gradually lost their market share to competitors. —