ISLAMABAD: Pakistan’s National Accounts Committee (NAC) has recently released the provisional National Accounts for the fiscal year 2022-2023 (FY23).
The estimates reveal that Pakistan’s GDP growth for FY23 is projected to be a mere 0.29%, in stark contrast to the 6.10% growth recorded in the previous fiscal year, FY22.
Throughout the outgoing fiscal year, Pakistan grappled with a series of economic challenges and political unrest, which cast a shadow over its GDP growth prospects. The nation encountered a myriad of obstacles, including rising inflation, fiscal deficits, a weakened currency, political instability, and a decline in capital flows, among other factors, all of which hindered its economic progress.
An in-depth analysis of the sector-wise breakdown sheds light on the factors contributing to Pakistan’s lackluster GDP growth. The manufacturing sector, in particular, experienced negative growth, primarily due to the adverse effects of tight macroeconomic policies and the higher cost of doing business. These factors exerted downward pressure on aggregate demand, resulting in a contraction of the manufacturing sector.
Conversely, the agriculture and services sectors played a pivotal role in supporting the overall economic growth of the country. Estimates indicate that the services sector is projected to grow by 0.86% in FY23, a decline from the 6.59% growth recorded in FY22. Meanwhile, the industrial sector is expected to experience a substantial decline of -2.94% in FY23, in stark contrast to the 6.83% growth observed in the previous fiscal year. The agriculture sector is estimated to grow by 1.55% in FY23, compared to the 4.27% growth recorded in FY22.
Based on the Gross Value Added at base price, Pakistan’s economy is estimated to reach PKR 38.9 trillion in FY23, a slight increase from the PKR 38.8 trillion recorded in FY22.
These figures present a challenging economic landscape for Pakistan, highlighting the need for strategic measures to address the country’s economic woes. Efforts to stabilize the manufacturing sector, mitigate inflationary pressures, bolster capital inflows, and ensure political stability will be crucial in revitalizing Pakistan’s GDP growth and fostering a more robust economy in the upcoming fiscal year.
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