According to the Economic Survey 2017-18, the national economy grew during the current fiscal year, although many vital targets were missed. For example, Pakistan registered a growth rate of 5.8% in 2017-18, the highest in the last 12 years. It may be added here that during first three years of the present government, real GDP growth remained above 4 percent while for last two consecutive years, it remained above 5 percent. Over the last four decades, the composition of Pakistan's GDP has undergone considerable change as the share of services sector in GDP has increased. Adviser to Prime Minister on Finance Dr Miftah Ismail has disclosed that Pakistan's external debt in relation to GDP had fallen during the last five years. The ratio has come down from 21.4% of GDP to 20.5% in 2017-18, adding that Pakistan may have continued to borrow money but it has also repaid old loans.
After witnessing 2% growth in the last fiscal year, the agriculture sector this time performed better due to exceptional growth in cotton ginning and better performance of crops. The sector grew at a pace of 3.81% this year, against the government's target of 3.5%. Production of major crops saw 3.6% growth against the target of 2%. This time the minor crops also grew by 3.33% against witnessing contraction in the last year. Cotton ginning surpassed the 6.5% target and showed 8.7% growth. Livestock also posted 3.8% growth, which is equal to its annual target. Forestry sector showed 7.2% growth but remained below the target of 10%. There was a surprising trend. The NAC revised down last year's forestry growth figure of 14% to negative 2.3% growth rate. Fishing sector grew by 1.63%, which is almost equal to the target. The services sector, which accounts for more than half of the economy, grew by 6.43%, slightly above the target. The wholesale and retail trade posted 7.5% growth against a target of 7.2%.
On the negative side, transport, storage and communication subsector saw 3.6% growth and fell short of the 5.1% target. Finance and insurance witnessed 6.1% growth against a target of 9.5%. The housing services saw a growth of 4% and the general government services 11.4% against the target of 7%. The government missed all its targets set for the industrial sector despite giving it a preferential treatment in supply of electricity. Heavy taxation and blockage of tax refunds affected the sector's performance. Against a target of 7.3%, the output in the industrial sector stood at 5.8%. The output of large-scale manufacturing stood at 6.2%, which was below the official target while small-scale manufacturing grew to 6.1%, also below the target. The slaughtering sector grew 3.5% and remained shy of the target. The electricity generation and distribution grew only 1.8% against a target of 12.5%, mining and quarrying sub-sector grew 3% against a target of 3.5%. The construction sector grew at a pace of 9.1% but missed the target of 12.1%.
The government also failed to address serious issues like stagnant investments and savings in terms of total size of the GDP and stagnant exports. The KSE-100 Index, which was Asia's top performer in 2016, underwent a massive correction the next year owing to macroeconomic stability, overvalued rupee, and political instability. It was only after the first round of devaluation that the KSE-100 started to pick up at the end of December. It has yet to recover its losses, and market talk suggests that is unlikely till the elections take place. All said, despite a better economic performance, the growth rate is still insufficient to absorb the youth bulge and any pace of growth below 7% rate will increase unemployment. The annual economic survey is a good indicator of where the government failed and shows the way to correction in the coming year.