Published On: Fri, Nov 10th, 2017

GDP of Pakistan for 2017-18 Expected to Grow at 5.5%

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GDP of Pakistan for 2017-18 According to World Bank GDP of Pakistan for 2017-18 and 2018-19 will be 5.5%. The economy of Pakistan is growing in past few years, which is great improvement.

It was further stated in the report that economic growth rate forecasts that oil prices will increase marginally and that “political and security risks will be managed.”

llango Patchamuthu, the World Bank’s country director, said: “Pakistan will need to continue with economic reforms and pursue policies that make the country compete better in global markets.”

It is predicted that there will be 5.8% growth rate in service sector in comparison to 6% in the previous year. The reason for the goods figures is contributed to sub-sectors of wholesale and retail trade and transport, storage and communications.

The industrial sector is likely to post a growth of 7% against 5% in 2016-17, thanks to improved power supplies and the China-Pakistan Economic Corridor (CPEC). The bank estimates that the agriculture sector will expand 2.9% in 2017-18 against 3.5% last year.

World Bank also expressed concerned over the current account balance and emphasized on the point that corrective policies need to be made to improve it. The expected current account deficit will be 4% of GDP in 2017-18 against 4.1% in the last year.

The current account deficit increased to 112% per year in the first quarter of the current fiscal year to $3.5 billion.
Furthermore, it is also probable that fiscal deficit may augment more. The reasons given are election year and slow increase in tax revenues due to election year. Moreover, inflation is expected to increase at 6% in 2017-18.

The World Bank gave a recommendation that flexibility of the rupee needs to be increased to tackle the problem of trade deficit. The gap between imports and exports of goods widened 37.1% per year to $7.2 billion in July-September.

The report further stated that “Policymakers are usually concerned with the short-term adjustment costs of a weaker currency.”

Furthermore,it was reported that, “Higher inflation could affect consumption negatively, but the overall impact of a moderate depreciation on growth is likely to be positive.”

It was emphasized that both short term and long term measures are required to further improve the economic outlook of the country. However, GDP of Pakistan for 2017-18 is looking good.

About the Author

- Junaid Ashraf has a Master of Philosophy degree in government and public policy. He has international publications through Taylor & Francis, a leading British publishing body. He regularly write columns for newspapers. His interests include international political economy, geopolitics and good governance. He writes for Asia Times.