Irshad Salim — Pakistan’s Planning Minister Ahsan Iqbal says the country’s macro economic indicators are highly positive and the growth of GDP in next fiscal year (Jul 2017-Jun 2018) is estimated at six percent.
The Minister said GDP growth rate during the current financial year (Jul 2016-Jun 2017) remained at 5.3 percent as compared to the revised target of 5.2 percent. The government had set a target of 5.7 percent for the current year.
Based on the present growth rate (unless revision is made by June or July), Pakistan’s economy crosses the $300 billion mark — the provisional economic report for 2016-17 suggests.
The growth rate of 5.3 percent achieved during the period is highest since 2008, when the country faced severe recession due to multiple factors including very high import price, power shortage and security related issues.
The news puts Pakistan in an elite list of countries having total gross domestic product over $300 billion.
Briefing the news persons in Islamabad on Friday, Iqbal said agriculture sector performed significantly during the current financial year with a 3.5 percent growth and he expects that in the next fiscal year its performance will be better.
According to observers, the agriculture sector performed marginally well due to incentives given by the government to farmers including credit facilities, subsidy on fertilizers and electricity bills. The services sector however keeps growing — it has seen a growth of 67 percent and remains the major contributor in the current growth.
Iqbal said the manufacturing sector also contributed satisfactorily and after the provision of uninterrupted gas and electricity has triggered the growth of industrial sector.
According to data released by the Pakistan Bureau of Statistics (PBS), large-scale manufacturing (LSM) in the country grew 10.46 per cent in March on a year-on-year basis, the highest growth recorded in the last few years. Experts interpret it as the beginning of a revival of the industrial production.
As Pakistan emerges from power shortages and makes gains in internal security and stability, its industrial sector is expected to boost production and add incremental value to the next year’s GDP growth rate set at 6 percent, several analysts told BE2C2.
The expansion in credit to private sector engaged in LSM, and to the SMEs, also played a role provided going forward it is held at sustainable levels, analysts added.
The expansion in credit to the private sector remained high due to low interest rates and better market conditions including an aggressive upward swing of the Pakistan Stock Index KSE-100 — banks, automobile, cement, petroleum and steel played major role in breaking records.
Auto Sector Grows
Industry-specific data shows the automobile sector recorded the highest growth of 20.97%, followed by food, beverages and tobacco 20.80%, iron and steel 19.52%, fertilizers 10%, pharmaceuticals 7.79%, non-metallic mineral products 7.12%, wood products 4.14%, chemicals 3.23%, rubber products 1.65%, and paper and board 0.12%.
Engineering goods showed a decline of 5.13%, electronic products 0.29%, coke and petroleum products 2.36% and leather products 4.25%.
US companies interested to invest in Pakistan
The US companies have expressed desire to invest in Pakistan in various sectors. The interest was shown by delegations of Philip Morris International and Pepsico Incorporation and Glaxo Smith Kline Pharmaceutical Company in their meeting with Pakistan Ambassador to the United States, Aizaz Chaudhry in Washington.
The Ambassador briefed them on lucrative investment opportunities in Pakistan.