Naya Pakistan will remain Purana Pakistan unless and until the fundamentals are changed and key among them are the economic fundamentals of our country. According to the latest figures issued by the Asian Development Bank and International Monetary Fund, Pakistan’s economy is forecast to grow at only 4.8%, whereas the target was 6.2%.
This “sharp deceleration” comes along with a rise in core inflation and current account deficit. According to an Editorial in Dawn “this is the second downward revision of the State Bank’s forecast for economic growth, and the second rise in the forecast for core inflation. Not only that, the current account deficit continued to rise in the first two months of the fiscal year, despite the strong growth in workers’ remittances and exports. In large measure, the difficulties on the external account front are the product of rising oil prices, but equally significantly, they are the result of pressing ahead with a type of growth that the economy was unable to afford. The net result is a decline in foreign reserves by $800m compared to the first two months of the last fiscal year.”
Further, “agriculture sector is now expected to grow at around 3 per cent rate – as against the original target of 3.8 per cent. The industrial output has been projected close to 5.8 per cent against 7.6 per cent original target. The services sector – that contributes nearly 60 per cent in the total national output – may also slowdown to nearly 5.7 per cent.”
If the Finance Minister wants to make a difference, he will need to “not only chart a difficult course into the future,” but persuade “those around him, including his colleagues and stakeholders in the economy, that the bitter pill is the only one on the menu.”
