Pakistan economy braves the turbulence

 

Despite global financial crisis, energy shortfall, Swat operation, and record number of dislocated population of around 3 million, Pakistan’s GDP growth rate manages to remain in positive territory, growing by 2 percent.

 

Let’s have a look at other indicators. Per capita income increased by 4 dollars from 1042 dollars to 1046 dollars. Exports are likely to stay in the vicinity of $18.5 billion by June this year, approaching last year’s level of $ 19.2 billion. Pakistan’s cement exports have exceeded 10 million tons in 11 months, with a growth rate of 50 percent owing to international demand. Rice exports are expected to exceed $ 2 billion, with a target of $ 5 billion by 2015.

 

The economic picture is not bad if compared with the performance of other economies in the region and the world. India’s exports dived down to $ 168 billion from the target of $ 200 billion, while China’s exports fell by an average 20 percent in the past six months and those of Vietnam by 30 percent.

 

In terms of rupees, Pakistan’s exports during April-July 2008-09 increased by 22 percent. Services trade deficit shrank by 38 percent during nine months of the fiscal year 2008-09 to $ 2.59 billion from $4.7 billion in the corresponding period of the previous year.

 

Remittances inflows into Pakistan continued to grow by 20 percent against the World Bank forecast of global decline.

 

Pakistan’s economy exhibited tremendous resilience in the face of all odds. The timely standby facility with IMF and a tightened monetary policy of raising interest rates helped to stabilize macro economic indicators and control inflation.

 

Public Sector Development Programme (PSDP) allocation of Rs. 626 billion for 2009-10 is a record and nearly 85 percent more than Rs. 359 billion in 2008-09.

 

The inflation rate is expected to fall to single digit by August from the current level of 14 percent and the high of 29 percent in November 2008.

 

From a low of 3.5 billion dollars foreign exchange reserves by end October 2008, Pakistan’s reserves jumped to 11.5 billion dollars in June 2009. The Federal Board of Revenue hopes to collect Rs. 1179 billion as revenue by the end of this month.

 

Pakistan attracted US $ 9 billion investment in the Telecommunications sector in the last three years. UAE’s Emirates Investment Group (EIG) plans to double network in Pakistan from current 42 branches in 25 cities to 100 branches in 45 cities and towns. Banking sector recorded an exponential growth in Pakistan during last five years, with increase in lending to corporate sector by 83 percent and Small and Medium Enterprises (SMEs) by 134 percent.

 

Pakistan joined the list of gold producing countries by producing 7.7 ton gold during last five years form Saindek Project. A Special Zone of 1,900 acres has been allocated near Port Qasim Karachi for investment by the Japanese companies. Investors from far and near countries continued to visit Pakistan to avail the opportunities. These companies hailed from the US, China, Japan, Germany, Turkey, UAE, Qatar, Argentina, and Canada. Foreign Direct Investment (excluding portfolio investment) stood at $ 3.3 billion. The government hopes to attract US $ 10 billion FDI by end 2009.

 

Karachi Stock Exchange has been enlisted in Dow Jones’ regional index of Federation of Euro-Asian Stock Exchanges (FEAS).

 

 

June 19, 2009

 

Courtesy: National News sources