ISLAMABAD: The government reported on Wednesday that the economy grew 5.97 percent after rebasing national accounts, slightly faster than the 5.74 percent growth in the previous year, we reported earlier.
For the current fiscal year 2021-22, the provisional GDP growth rate has been estimated at 5.97 percent, with the growth of the agricultural, industrial, and services sectors at 4.40 percent, 7.19 percent, and 6.19 percent, respectively. The higher GDP numbers were attributed to imports and consumption-led growth, according to multiple independent economists.
Pakistan’s GDP is forecast to reach Rs66.949 trillion in 2021-22, which will translate into an increase in per capita income from Rs268,223 in 2020-21 to Rs314,353 in 2021-22. A year ago, the per capita income was 1,676 dollars. In 2021-22, it was 1,798 dollars. The total volume amounted to $383 billion.
In a meeting under the chairmanship of the federal secretary of planning, the National Accounts Committee (NAC) approved rebasing of the national accounts from the fiscal year 2005-06 to the fiscal year 2015-16. For 2019-20, a revised GDP growth rate of 0.94 percent was approved, as well as a revised growth rate of 5.74 percent for 2020-21.
According to the federal secretary ministry of planning, they have directed the Pakistan Bureau of Statistics (PBS) to authenticate the methodologies used to calculate GDP growth statistics. A spokesperson for the minister of planning also made it clear that no pressure was being applied to them.
According to Shaukat Tarin, 6 percent of GDP growth in 2022 is a slap in the face for Pakistan Democratic Movement, which called us incompetent and selected”.
It’s a remarkable performance after Covid. Bravo to Prime Minister Imran Khan and the PTI economic team,” Tarin wrote in a tweet. “PDM must now match our performance”.
The Planning Commission’s Chief Economist, Dr Mohammad Ahmed Zubair, resigned. He allegedly left due to disagreements with the Commission’s estimates of GDP growth.
Over the last few decades, Pakistan has experienced a boom-and-bust cycle of growth. In general, a higher growth rate will create imbalances such as a higher budget deficit and current account deficit. Growing at this rate has never been sustainable.
The projected imports come in at $75 billion, compared with initial estimates of $55 billion, contributing almost one percent to the GDP and boosting the growth rate.
Besides the expansionary fiscal and monetary policies fueling the economy’s growth, foreign loans and debts have brought the economy to the edge of bankruptcy. As part of the Extended Fund Facility (EFF), Pakistan has begun consultations with the IMF in Doha (Qatar).
A 5.44 percent increase in other crops is largely due to the increased production of pulses, vegetables, fodder, oilseeds, and fruits. Growth in the livestock sector was 3.26 percent, forestry 3.13 percent, and fishing growth was 0.35 percent.
According to provisional figures, industrial output increased 7.19 percent. Due to a decrease in the production of other minerals, the mining and quarrying sector decreased by 4.47 percent.
Large-scale manufacturing was up 10.4 percent between July 2021 and March 2022, based largely on QIM data.
With an increase in general government spending, value-added in construction increased by 3.14 percent, driven mainly by construction-related expenditures by industries.
Despite the moderate growth rate, the relevant deflator (WPI building materials) increased by 30.1 percent.
The wholesale and retail trade industry grew by 10.04 percent, while the services sector grew by 6.19 percent.
Agriculture, manufacturing, and imports all contributed to the growth of this industry.
