Growth estimate for next year set at 4.8pc: Asad

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Staff Reporter
Islamabad

Federal Minister for Planning, Development and Special Initiatives Asad Umar said on Friday that the growth rate for the next year had been estimated at 4.8 percent.

Addressing a press conference in Islamabad on the annual budget plan, Umar said: “Next year’s growth rate of the economy has been estimated at 4.8pc which has increased from 3.94pc for this year.”

The National Accounts Committee had last week estimated Pakistan’s provisional GDP growth for the current fiscal year (2020-21) at 3.94pc, supported by a broad-based recovery in major sectors.

The federal minister said that there were six to seven big sectors the future growth rate was coming from.

The first he said was cotton production which was badly affected in the past and in the current year as well due to which “we face a lot of loss.”

“This year, arrangements have been made for better [quality] seeds and emphasis has been placed on provision of good quality pesticides,” he said, adding that cotton prices in the international market were also seen to be better.

He said that due to all this, an estimate of 10.5 million bales of cotton had been forecast for neat year.

The second sector, according to the federal minister, was poultry and livestock. He said the poultry sector had been badly affected by Covid-19 in particular which had caused a price hike but it would contribute to growth in the future as it moved towards normalisation.

“Apart from that we are also seeing an increase in electricity consumption of 6pc […] we got a very amazing response from the industrial incentive package we gave and there has been an increase of 15pc in industrial consumption since we gave the package.”

He said the government forecast that this demand for electricity would keep increasing into the next year and this was also contributing towards growth.

Umar added that efforts to increase production of other fuels such as natural gas and coal for increased power production were also underway and those would also contribute towards growth.

Umar particularly highlighted the construction industry as a major reason for growth and which had been “championed” by Prime Minister Imran Khan because it provided the most employment opportunities in the cities and which affected industries the most.

“One reason for the industrial growth you are seeing is construction and it has started to pick up,” he said, adding that a sustained growth in the sector was being seen and it would become a “driver” of economic growth.

The federal minister said next came exports, what he termed the “jugular vein” of the economy. He said that exports for the current fiscal year were $25.2 billion and these were estimated to grow to $26.8bn in the next year.

He said the current year’s exports were the highest for the past 10 years and the target for next year would be “the highest exports in Pakistan’s history.”

Concerning remittances, he said the government was not factoring in as strong a growth compared to the current year’s and remittances were projected to grow from $29.1bn to $31.3bn.

Umar pointed out that one sector in particular which was seeing very high growth was the IT sector and digitisation.

He said it had been a major target of the government, many incentives were provided for it and key milestones had been achieved which had led to a boost to digital commerce and the growth in IT exports was projected to continue to the next year.