Despite the challenges, the economy showing inclusive growth grows by 3.94% in FY21: Economic survey 2021 –
ISLAMABAD: Despite a myriad of challenges, the economy has gradually embarked on a path of more inclusive and sustainable growth thanks to multiple measures and achievements during the current fiscal year, with a rate of 3.94 %, according to Pakistan Economic Survey 2020-21 revealed by the Minister of Finance, Shaukat Tarin.
“Pakistan’s economy rebounded strongly in FY2021 and posted growth of 3.94%, which is not only considerably higher than the previous two years (-0.47 and 2.08% in fiscal years 2020 and 2019 respectively), but also exceeded the target (2.1% for fiscal year 2021). “, indicated the investigation.
Despite tight budget constraints, timely and appropriate policy measures taken by the government have resulted in a V-shaped economic recovery, he added.
The manufacturing sector has seen widespread growth, with major large-scale manufacturing (LSM) sectors including textiles, food drinks and tobacco, non-metallic mineral products, and automobiles showing significant improvement.
The industry recorded the strongest period growth of 8.99% in the first nine months of fiscal 2021 since fiscal 2007.
The current account posted a surplus of $ 0.8 billion between July and April in fiscal 2021 for the first time in 17 years, while foreign currency inflows through the Roshan Digital Account (RDA) crossed the billion dollar mark.
In fiscal year July-April 2021, workers’ remittances showed a historically high growth of 29% and reached $ 24.2 billion while the foreign exchange reserves of the State Bank of Pakistan increased. reached $ 16 billion, a four-year high.
Considering the important performance related to Financial Action Task Force (FATF) conditions, export potential and e-commerce, Pakistan has been added to Amazon’s list of sellers.
Federal Board of Revenue (FBR) tax collection grew significantly by around 18% in fiscal year July-May 2021 due to the recovery in national economic activity and comprehensive policy reforms current tax and administration.
The primary balance remained in surplus at 1.0% of GDP (gross domestic product), the highest level in the first three quarters in 12 years while on May 27, 2021, the Pakistan Stock Exchange (PSX) experienced a record daily trading volume. with 2.21 billion shares traded in a single session, according to the survey.
Due to its impressive growth, the PSX won the title of the best Asian stock market and the fourth best performing market in the world in 2020.
According to the survey, the profile of domestic debt has improved significantly during the current government’s tenure, with short-term debt, as a percentage of total domestic debt, declining to 23 percent at end-March 2021, from 54 percent. % at the end of June. , 2018.
Over 80% of net borrowing from domestic sources was made through medium and long-term domestic debt instruments (Pakistan Investment Bonds & Government Ijara Sukuk) in the first nine months of fiscal 2021.
Pakistan entered the international capital market after a gap of more than three years by successfully raising $ 2.5 billion through euro bonds while the policy rate remained unchanged at 7.0%, which improved the feelings of companies and thus stimulate economic activities allowing the resumption of employment.
During the July-February 2021 financial year, the two gas distribution companies (SNGPL and SSGCL) laid 143 km of gas transmission network, 2,616 km of distribution lines and 886 km of services, and connected 70 villages / towns with a gas network.
During the same period, 304,573 additional gas connections, including 303,243 domestic, 1,020 commercial and 310 industrial, were provided across the country.
According to the survey, installed electric capacity increased to 37,261 megawatts between July and April for fiscal year 2021 compared to the same period last year, showing an addition of 1,289 MW.
Likewise, its production rose to 102,742 GWh, ie an additional production of 6,360 GWh during the period under discussion. Industry’s share of electricity consumption rose to 26.3 percent in July-March for fiscal 2021, from 25.5 percent for the same period last year.
The number of cellular mobile subscribers (number of active SIM cards) in Pakistan reached 182 million at the end of March 2021, compared to 167.3 million at the end of June 2020, an increase of 8.6% in the nine months for fiscal year 2021.
At the end of March 2021, the number of broadband (BB) subscribers reached 100 million. Total BB penetration in Pakistan stood at 47.6% in March 2021, registering an increase of approximately 19.7% compared to the end of March 2020.
Under the Ehsaas emergency financial assistance program, 179.3 billion rupees were disbursed. About 14.8 million families have benefited from the program. The World Bank has recognized the Cash Program among the top four social protection interventions in the world in terms of the number of people covered.
As part of the Kamyab Jawan Youth Entrepreneurship Program, Rs 8,566 million had been paid out until April 2021 to young people for various businesses.
The 10 billion Tree Tsunami Program planted around 350 million plants during the July-March 2021 fiscal year, with around 100,000 daily bets employed. In total, more than 800 million seedlings have been planted in the past two years.
The International Monetary Fund (IMF) has recognized that government policies have been essential in supporting the economy and saving lives and livelihoods. The IMF and Pakistan have announced the resumption of the stalled $ 6 billion loan program.
During the year, the three major credit rating agencies, Moody’s, Fitch and Standard & Poor’s, reaffirmed their sovereign credit ratings for Pakistan.
“This reaffirmation reflects the good policies of the government and the confidence that these large international institutions place in the economic prospects of the country”, notes the survey.
He said Pakistan was implementing a stabilization policy after the 2017-18 crisis and the economy was recovering from macroeconomic imbalances, but COVID-19 slowed the pace, which was initially recovered, but the advent of the 2nd and 3rd waves posed significant challenges that were met. through timely prudent policies.
“Pandemics like COVID-19 are a unique event that devastates global economies. Pakistan has done much better to deal with the pandemic compared to many countries, ”the survey added.
The government, he said, has made several important policy decisions: monetary and fiscal measures, smart lockdowns as well as rapid vaccination. The National Command and Operations Center (NCOC), as a single organization, was responsible for making key decisions in collaboration with the provinces. The situation was brought under control thanks to the government’s swift decision-making, as the number of daily COVID-19 cases was currently on a downward trend, the survey added.
He said that before COVID-19, the labor force was 55.74 million, and the number fell to 35.04 million, indicating that people had lost their jobs or were unable to work. . Due to careful government decisions, the labor force reached 52.56 million until October 2020.