ISLAMABAD: Finance Minister Ishaq Dar presented the economic survey for the fiscal year 2023 detailing the coutry’s gains amidst several challenges including lowest GDP growth rate and all-time high inflation.
The minister defended the coalition government’s initiatives and achievement amidst devastating floods of last year that shattered the country’s economy.
He said that the Pakistan Muslim League-Nawaz and its coalition partners assumed charge of the government with an inherited shaky economy.
Dar recalled that when he was the finance minister in the last PML-N tenurer, the economy ranked at 20th position in the world but the PTI-led pushed it to the 47th position.
The minister said that Pakistan witnsessed a meagre GDP growth of 0.29 % against the target of 5% during the outgoing year. He said that inflation remained at 29%, FBR collection at Rs6,210 billion, the trade deficit declined from $23 billion to $ 21 billion.
He claimed that during his tenure, the current account balance improved by 74.1%, recording a deficit of $3.4 billion (July-March 2023) compared to a deficit of $13 billion in the same period in 2022.
Growth
According to documents shared by the federal minister, Pakistan achieved Gross Domestic Product (GDP) growth of 0.29% for the outgoing fiscal year against a planned target of 5%
He said that agriculture, industry and services sectors witnessed a growth of 1.55%, -2.94% and 0.86% respectively, and all missed the set targets.
However, the construction sector witnessed a bit growth compared to other sectors with a growth of about 3% against the target of 7.1%.
Inflation
Rising inflation was the one major issue of the country. According to the document shared by the minister, Pakistan registered inflation of 29.2% in the 11-month from July 2022 to May 2023, compared to 11.3% in the same period last year. Independent experts believe the country’s inflation stands above 40%.
The government had set the target of 11.5% for inflation during the outgoing year, but suffered owing to the sharp depreciation of the Pakistani rupee and global supply shocks affecting imports.
FBR tax collection
The Federal Board of Revenue (FBR) tax collection grew by 16.1 % to Rs6,210 billion from July to May against Rs5,348.2 billion in the previous year. The collection target for the 12-month period set by the government was Rs7,470 billion.
Trade deficit
The document maintained that Pakistan’s exports decreased by 9.9% from July to March to $21 billion compared to $23 billion in the same period last year.
However, imports during the same period went down to $43.7 billion against $58.9 billion in the same period last year, reflecting a decline of 25.7%. This reduction came primarily because of administrative measures as the government sought to protect its depleting foreign exchange reserves.
As a result, the country’s trade deficit significantly slid back to 6% of GDP, compared to 10.4% from last year.
Current account
The current account balance improved by 74.1%, recording a deficit of $3.4 billion during Jul-Mar against a deficit of $13 billion in the outgoing year.
The document revealed that the key factor behind this improvement was the 29.7% decrease in the merchandise trade deficit on the back of a substantial decline in import payments to $41.5 billion in Jul-Mar from $ 52.7 billion last year”
