Islamabad, May 21, 2024 – The National Accounts Committee (NAC) has approved the provisional growth rate of Pakistan’s Gross Domestic Product (GDP) at 2.38% for the ongoing fiscal year 2023-24.
This decision was made during the 109th NAC meeting, chaired by the Secretary of the Ministry of Planning, Development, and Special Initiatives.
According to a press release issued today, the NAC also approved the quarterly GDP growth rates for the first (revised), second (revised), and third quarters of FY 2023-24, alongside the annual growth rates for the previous fiscal years 2021-22 (final) and 2022-23 (revised).
Quarterly and Annual Revisions
The revised estimates for the first and second quarters of FY 2023-24 show notable adjustments. The GDP growth for the first quarter has been revised from 2.50% to 2.71%, and for the second quarter from 1.00% to 1.79%. These revisions are largely due to better-than-expected performance in key sectors, particularly agriculture.
The agriculture sector saw stable growth in the first quarter, slightly adjusted from 8.58% to 8.59%, and improved in the second quarter from 5.02% to 5.83%. This was mainly driven by significant upward revisions in important crops (from 8.12% to 12.92%) and other crops (from -0.31% to 0.65%).
Despite positive adjustments in mining and quarrying, which saw an increase from 7.78% to 15.46%, the industrial sector faced a downward revision in the first quarter from -0.24% to -2.44%, primarily due to a significant decline in electricity, gas, and water supply from -12.70% to -27.62%. However, the industrial sector showed a slight recovery in the second quarter, with growth revised from -0.84% to 0.09%.
The NAC stated the services sector showed improved growth rates, revised from 0.92% to 2.02% for the first quarter and from 0.01% to 0.75% for the second quarter, driven by gains in information and communication, public administration, social security, education, and health services.
Third Quarter Performance
The economy posted a stable growth of 2.09% during the third quarter of FY 2023-24, with agriculture, industry, and services contributing 3.94%, 3.84%, and 0.83% respectively. Agriculture’s positive performance was led by important crops (2.89% due to wheat), other crops (1.14%), cotton ginning (61.75%), and livestock (4.20%).
The industrial sector’s growth of 3.84% in the third quarter was driven by mining and quarrying (0.63%), large-scale manufacturing (1.47%), and electricity, gas, and water supply (37.3%), despite the negative growth in the construction industry (-15.75%).
Annual Growth Rates
The committee confirmed the final GDP growth rate for FY 2021-22 at 6.18%, slightly adjusted from the previously estimated 6.17%. The growth rates in agriculture, industry, and services for this period were finalized at 4.21%, 7.01%, and 6.69%, respectively.
For FY 2022-23, the revised GDP growth rate was slightly reduced to -0.21% from the previously estimated -0.17%. Agriculture showed a marginal improvement from 2.25% to 2.27%, while the industry remained stable at around -3.74%, and services declined slightly from 0.07% to -0.01%.
Provisional Growth for FY 2023-24
The provisional growth for FY 2023-24 in agriculture is estimated at 6.25%, with industry and services both at 1.21%. The robust growth in agriculture is attributed to double-digit increases in major crops, such as wheat (11.64%), cotton (108.22%), and rice (34.78%).
Sectoral Performance
The mining and quarrying industry recorded a growth of 4.85%, driven by increases in the production of crude oil (1.51%), coal (37.72%), and other minerals (7.57%). However, the electricity, gas, and water supply industry experienced a decline of 10.55% due to reduced subsidies.
The services sector achieved a growth of 1.21%, with notable gains in wholesale and retail trade (0.32%), transport and storage (1.19%), education (10.30%), and health services (6.80%). However, high inflation negatively impacted information, communication, finance, insurance, public administration, and social security industries, which posted declines.
The NAC’s approval of these growth figures highlights the diverse performance across different sectors and underscores the ongoing efforts to navigate economic challenges and drive sustainable growth in Pakistan.