Tax collection, industrial activity up in outgoing fiscal year: SBP

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Observer Report
Karachi

The State Bank of Pakistan on Thursday in its second quarterly report on the state of economy for the fiscal year 2020-21, highlighted the strengthening of the economic recovery which, it said, was evident from the growing pace of industrial activity, promising output of major Kharif crops (with the exception of cotton), and a pick-up in the services sector during the review period.

The large-scale manufacturing grew by 7.6 percent during H1-FY21, with its growth in the second quarter accelerating to 10.4 percent, the highest quarterly LSM growth since Q4-FY07, the report said.

It said construction-allied and food processing industries generated much of the
momentum in industrial activity.

The construction industry benefited from the favorable policy environment, which included the government’s fiscal incentives under the construction support package, the Naya Pakistan Housing Scheme, as well as
financial measures from the State Bank.

The report pointed out that financing to the housing and construction sector in Pakistan has almost always remained quite negligible in the credit portfolios of banks when compared with other developed and developing countries.