This is the second lowest growth rate ever recorded in Pakistan in the last 50 years
- This is the second lowest growth Pakistan has ever seen in the last 50 years.
- The growth rate was shared after the NAC reviewed the revised figures.
- The quarterly GDP compilation methodology was examined from a sector perspective.
ISLAMABAD: In a bid to win over the International Monetary Fund (IMF), the caretaker government has revised the GDP growth rate claimed by the Pakistan Democratic Movement (PDM) government from 0.29% to -0.17% for fiscal year 2022. -2023. The news on Wednesday.
This is the second lowest growth the country has ever seen in the last 50 years, as the lowest growth the country achieved was -1% during the COVID-19 pandemic. However, the GDP growth rate turned positive at 2.13% in the first quarter (July-September) of the current financial year 2023-24 as compared to -2.7% seen in the last quarter of the financial year 2022 -23.
These figures show that the growth rate under the PDM-led government was 0.29% in the provisional figures, but in the final figure it has been projected in the negative zone of 0.17% for the entire financial year 2022-23.
According to an official statement issued by the Pakistan Bureau of Statistics (PBS), the National Accounts Commission (NAC) has approved the introduction of the Quarterly National Accounts into the country’s statistical system.
The data was released after the NAC met to review the annual GDP estimates for 2021-22 (final), 2022-23 (revised) and quarterly estimates from Q1 2016-17 to Q1 2023-24 in Ministry of Planning, Development and Special Initiatives.
The meeting was chaired by the planning secretary.
The final GDP growth rate of FY21-22 is estimated at 6.17% from 6.10% seen in the revised figures. The revised GDP growth rate for the year 2022-23 is estimated at -0.17%, which was provisionally estimated at 0.29%.
As an outstanding step in the history of Pakistan’s macroeconomic statistics, NAC reviewed, reviewed and approved the methodology for compiling quarterly GDP as well as the series of quarterly GDP growth rates for various sectors from the first quarter of 2016-17. by Q1 2023, taking 2015-16 as base year.
The IMF later included the QNA compilation in its Stand-By Arrangement (SBA) structural benchmark, which stated that “PBS will compile and disseminate the first quarter estimates for 2023-24 and the revised annual estimates for financial year 2022-23 until the end of November 2023.’
To meet the structural benchmark under the SBA, PBS held meetings with stakeholders and data providers and presented the revised GDP numbers for 2022-23 and the first quarter of 2023-24 before the NAC. The committee approved the QNA series from 2016-17 to 2022-23.
The committee also approved the first quarter estimates for 2023-24 along with the data dissemination and revision policy.
The GPA growth rate of 2.13% has been estimated for the first quarter of 2023-24 compared to the first quarter of 2022-23.
Agriculture showed growth of 5.06%, industry 2.48% and services 0.82%. In agriculture, crops registered a healthy growth of 6.13%, including an 11.16% increase in major crops.
The main driver of growth in major crops is the increase in area sown compared to the previous year.
For example, the area sown to rice, cotton and maize increased by 21%, 11% and 5%, respectively. It was down 11% for sugarcane, which is offset by the other three major crops. The sector, after experiencing a continuous decline for three quarters in 2022-23, apart from a modest growth in the second quarter, reversed course in the first quarter of 2023-24 to register a growth of 2.48%.
Positive growth of 2.15% is noted by the mining and quarrying sector based on the quarterly production of the mining sector.
LSM growth is based on the Quantum Index of Manufacturing (QIM), which showed a growth of 0.93% in Q1 2023-24. An increase of 0.08% has been reported in electricity generation and distribution, natural gas distribution and water supply. The growth of the construction sector has been estimated at 1.73% based on the production of construction indicators. Cement production increased by 15.38% in the first quarter of 2023-24 compared to the corresponding quarter of the previous year.
Similarly, an increase was observed in other indicators. Iron and steel showed a negative growth of 2.20% during the first quarter of 2023-2024. However, its impact was offset by other indicators.
In the first quarter of 2023-24, overall services growth is 0.82%. Wholesale and retail trade, which is based on the output of agriculture, manufacturing and imports, is estimated at 3.05% due to positive growth in agriculture and industry.
Transport shows growth of 1.7%, based on quarterly figures reported by the sources. Information and Communication, which remained negative for most quarters of last year, reversed course to register growth of 2.4% mainly due to a low base and quarterly information received from the sources.
The finance and insurance sector has a growth of -12.79% due to the decrease in the production of insurance companies, brokerage firms and stock brokers, as well as the high growth of the deflator. General government (which is based on federal, provincial, regional and cantonal/local government budget documents) reported growth of -16.65% in the first quarter of 2023-2024.
Further, a high deflator also led to a fall in fixed prices. The negative growth in both education and human health and social work activities is mainly due to the decrease in the state budget components together with a high deflator.
GDP estimates are published to meet the IMF’s structural benchmarks under tight deadlines and are based on available information and data. However, as a matter of practice and due to the time lag involved in finalizing the figures for the last two financial years, the annual GDP estimates are subject to revision at the NAC meeting to be held in May 2024.
Originally published on The news
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