The agriculture, industry, and services sectors have missed their growth targets, with the industrial sector experiencing a contraction of 2.94% instead of the expected growth of 7.1%.
During a presentation on the government’s economic performance, the finance minister discussed the challenges faced by the Pakistan Democratic Movement (PDM) when they took over the economy. He emphasized that when he previously served as finance minister in 2017 under Nawaz Sharif’s leadership, he left Pakistan in a strong economic position and aimed to prioritize macroeconomic stability.
The minister highlighted a framework that focused on five key areas: exports, equity, empowerment, environment, and energy. These areas formed the basis of the government’s roadmap for the upcoming year.
In terms of growth, Pakistan fell significantly short of its target, achieving a GDP growth of only 0.29% for the outgoing fiscal year.
The agriculture, industry, and services sectors all missed their growth targets, with the industrial sector experiencing a contraction of 2.94% instead of the expected growth of 7.1%.
The finance minister stressed the government’s aim to restore the country to the path of progress it had reached in 2017. He emphasized the importance of achieving macroeconomic stability and resilient and inclusive growth, ensuring sustainable development without resource and wealth misallocation.
Inflation remained a concern, with Pakistan registering inflation of 28.2% for the nine-month period from July 2022 to March 2023, significantly surpassing the target of 11.5%.
The depreciation of the rupee and global supply shocks leading to expensive imports were identified as the main factors contributing to this increase.
Tax collection by the Federal Board of Revenue (FBR) showed growth of 16.1% compared to the previous year, reaching Rs5637.9 billion from July to April. However, the government’s target for tax collection over the 12-month period was set at Rs7,470 billion.
Pakistan’s trade deficit narrowed as exports declined by 9.9% and imports decreased by 25.7% during the period from July to March.
The government implemented policy tightening measures to protect foreign exchange reserves, resulting in a reduction in the trade deficit from 10.4% to 6% of GDP.