Economic Survey released
Economy crosses threshold of $300bn; No need of IMF after 2019
Expressing optimism over achieving overall economic growth rate of 5.28 percent- the highest in ten years and reducing the fiscal deficit to 4.2 during the outgoing fiscal year, finance minister while presenting the Economic Survey for the year 2016-17 Thursday stated there has been a visible growth in the national economy.
“After almost 10 years, we have exceeded 5% GDP growth. In 2013, we were in the range of 3% growth, and within 4% in the next couple of years. This year, the Pakistani economy has grown by 5.28%, rounded off to 5.3% GDP growth,” said Ishaq Dar while addressing a news conference.
He said the volume of Pakistan’s economy crossed the threshold of three hundred billion dollars during the outgoing financial year.
Briefing the media about the performance of different sectors, the finance minister said that overall economic growth remained 5.28 per cent five point two eight percent which is the highest in the last ten years.
He said the industrial sector contributed 21 per cent, agriculture 20 per cent and services 60 per cent to the GDP.
Giving a breakdown, Ishaq Dar said that agriculture growth remained 3.46 percent, services 5.98 and industries 5.02 percent.
He said that six percent growth target has been set for the next financial year.
About the industrial growth, Dar said that the electricity and gas sector grew by 3.4%, large scale manufacturing (LSM) by 5.46%, construction grew by 9.05% while cotton production increased by 10.7%.
Turning to the agriculture sector, the finance minister reminded that its growth remained 0.27 percent last year. Kissan package worth 341 billion rupees has paid the dividends to raise its growth to 3.46 percent this year. Under the package, he said the agriculture inputs including fertilizers were subsidized.
He said the production of different major crops also witnessed an increase during the period. Wheat crop production remained 25.75 million tonnes this year as compared to 25.63 million tonnes last year. Cotton production remained 10.6 million bales this year as compared to 9.92 million bales last year. He said efforts are being made to further improve cotton production in order to meet the demand domestic of textile industry.
About the agriculture credit, he was confident that it will achieve the target of seven hundred billion dollars this year.
Ishaq Dar said inflation according to Consumer Price Index was 8.69 percent in 2013-14 and it is expected to close at 4.09 percent at the end of the current financial year as a result of measures taken by the government.
He said exports is the area of concern and government is focusing on it. He said exports are 17.91 billion dollars in the first ten months of the current fiscal year. He said the exports are likely to close at 21.76 billion dollars. He said package given to exports has been enforced and this will continue during the next financial year. He pointed out that imports of the country have increased to 37.40 billion dollars during the first ten months of current fiscal year as compared to 33.44 billion dollars during the same period last year.
These are expected to close at 45.48 billion dollars at the end of the year. He said import of plants and machinery have been increased by 40 per cent which is good for the growing economy.
The minister said current accounts deficit is expected to close at 8.3 percent this financial year.
He said remittances are expected to close at 19.5 percent this year showing a decline of 2.6 percent. He said Foreign Direct Investment has increased to 1.73 billion dollars during the first ten months of this year as compared to 807 million dollars during the same period last year. He said it is expected to reach 2.58 billion dollars. He said at present, foreign exchange reserves stand at just under twenty billion dollars. He said exchange rate as of 22nd of this month was 104.87 which is satisfactory.
Ishaq Dar said per capita income was 1333 dollars in 2013 which has increased to 1629 dollars.
Upbeat about the performance of stocks, the minister said the market capitalization has doubled over the last four years. He said the decision of merging different stocks into Pakistan Stock Market helped earn the status of best performing market in Asia and the fifth largest in the world.
He was confident to close the financial year at the fiscal deficit of four point two percent which was eight point eight percent when the present government assumed power.
About the net public debt, the minister said it stands at 18892 billion rupees which is 59.3 percent of the GDP.
Dar said that FBR is expected to achieve the revised collection target of 3521 billion rupees.
About the war on terror, the minister said that it has cost the country 123.13 billion dollars. He said the country is annually spending ninety to one hundred billion rupees in the war on terror.
He said that one hundred billion rupees will be set aside for the next fiscal year for the rehabilitation and reconstruction of tribal areas. The amount will also be used for raising new wings of civil armed forces.
Upbeat over the economic performance, Ishaq Dar while responding to questions said, we won’t need to go to the IMF after 2019. Our home-grown industries will be able to help us. Pakistan will also be part of the G20, said Dar, adding that the size of the country’s economy would surpass that of Canada, Italy and South Korea by 2050.