Overview of national economy
PAKISTAN’S economy is moving progressively on higher inclusive and sustainable growth path on the back of various measures and achievements despite myriad of challenges during the financial year 2020-21.
According to the information gathered from the official sources concerned, major achievements highlighting the economic performance during FY 2021 are briefly mentioned below: Pakistan was implementing stabilization policy post crisis of 2017-18 and the national economy was recovering from macroeconomic imbalances but COVID-19 slowed down the pace which was recovered initially but the advent of second and third wave of the pandemic one after the other brought the significant challenges which were, however, met by the timely prudent policies by the incumbent federal government through its implementing organizations and agencies down the line.
Pandemics like COVID-19 are once in a century event that devastated global economies, but Pakistan had done much better in coping with the pandemic of Corona Virus as compared to many countries around the globe.
The federal government took several measures important policy decisions: monetary and fiscal measures, smart lockdown, rapid vaccination etc, National Command and Operating Centre (NCOC) as a single organization was made responsible to take key decisions in collaboration with the provinces.
Situation was put under control due to the federal government’s timely decision making as a result of which the numbers of daily COVID-19 cases are presently showing declining trend.
Prior to COVID-19, the working population of the country was 55.74 million.
The number declined sharply to 35.04 million which indicated that either the people had lost their jobs or were not able to work. However, due to prudent decisions by the federal government, working population had reached 52.56 million till October 2020. National economy has witnessed a V-shaped recovery.
The current economic recovery, it is pertinent to mention, has been achieved without compromising internal and external stability of the country.
Current account posted a surplus of $ 0.8 billion during July 2020-April 2021 period for the first time in 17 years. Inflows of foreign exchange through the Roshan Digital Account (RDA) crossed the $ 1 billion mark. During July-April FY 2021, workers remittances posted historically high growth of 29 per cent reaching to the level of $ 24.2 billion.
Foreign exchange reserves with the State Bank of Pakistan rose to $ 16 billion mark, four years high.
Keeping in view the significant performance pertaining to Financial Action Task Force (FATF) conditions, potential of exports and e-commerce, Pakistan has been added into the Amazon’s seller list.
Due to its impressive growth, Pakistan Stock Exchange earned the title of being the best Asian Stock Market and the fourth best performing market across the world in 2020.
Profile of domestic debt has improved significantly during the tenure of the present government as short-term debt as percentage of total debt has decreased to 23 per cent at the end of March 2021 compared with 54 per cent at end June 2018.
Over 80 per cent of the net borrowing from domestic sources was through medium-to-long term domestic debt instruments i.e. Pakistan Investment Bonds & Government Ijara Sukuk during first nine months of FY 2021.
Pakistan has entered the international market after a gap of over three years by successfully raising $ 2.5 billion through Euro Bonds.
The policy rate has remained unchanged at 7.0 per cent which led to improved business sentiments and the stimulating economic activities enabling employment to recover.
Cellular mobile subscribers (number of active SIMs) in Pakistan have reached 182 million at the end of March 2021 as compared to 167.3 million by the end of June 2020 showing an increase of 8.6 in nine months of FY 2021.
At end of March 2021, broadband (BB) subscribers reached to 100 million at the end of March 2021 as compared to 167.3 million by the end of June 2020 showing an increase of 8.6 in nine months of FY 2021. At the end of March 2021, broadband (BB) subscribers reached 100 million.
The total BB penetration in Pakistan as such stood at 47.6 per cent in March 2021 registering an increase of about 19.7 per cent as compared to end March 2030.
International Monetary Fund (IMF) has acknowledged that the incumbent Federal Government’s policies have been critical in supporting the national economy and saving lives as well as livelihoods.
The IMF and Pakistan have announced the resumption of stalled $ 6 billion loan programme. During the period under report, all three major credit rating agencies ie Moody’s, Fitch and Standard & Poor’s have reaffirmed their sovereign credit ratings for Pakistan.
This reaffirmation is reflective of the sound policies of the incumbent federal government and of the confidence reposed by these leading international institutions in the country’s economic outlook.
—The writer is Lahore-based Freelance Journalist, Columnist and retired Deputy Controller (News), Radio Pakistan, Islamabad.