Finance Minister Muftah Ismail is presenting the Economic Review Report for the financial year 2012-13, which shows that the growth rate was...
Finance Minister Muftah Ismail is presenting the Economic Review Report for the financial year 2012-13, which shows that the growth rate was 5.97% as against 4.8%.
Presenting the Economic Survey in Islamabad along with Planning Minister Ahsan Iqbal and Khurram Dastgir, Finance Minister Muftah Ismail said that the problem of Pakistan is unfortunate that when we make progress, current accounts run into deficit.
He said that with the new estimate of 5.97% GDP growth in the current financial year, the current account deficit has gone out of control and the balance of payments crisis has come.
"This year, our imports will be between 76 billion and 77 billion, which is also the highest in terms of historical and GDP ratio," he added.
He said that exports have also increased but only 28% due to which the trade deficit has reached 45 billion.
Muftah Ismail said that there was a time when Pakistan's exports were halved compared to its imports which is now only 40 per cent. So we have to rely on remittances and loans which is why we often face the problem of balance of payments.
He said that during Code 19, when world trade was low, petroleum products, gas became cheaper, the balance of payments was balanced but then as it grew and the same formula was adopted, the balance of payments deteriorated.
The Finance Minister said that after a long hiatus, Pakistan's foreign exchange reserves have come down from 10 billion to 9.6 billion and after receiving 2.4 billion from China by next Monday, it will reach 12 billion again. Will come to the level of
He said that Pakistan's economic direction needs to be improved. The price of oil in the world market has become very high due to which we also had to increase the prices by Rs.
He further said that we had to take difficult decisions, the country was on the verge of bankruptcy, now we have deviated from this path, now we are on the path of stability and will soon see stable growth.
He said that there are two aspects of our growth one is that which is stable in which recurrent current account deficit, balance of payments is not bad.
Muftah Ismail said that the GDP growth rate for the current financial year has been 5.97% but as usual, the current account deficit has again raised the issue of balance of payments.
"We need comprehensive growth. We make the mistake of giving incentives to the investor class to carry on trade, but the result is that when the princes invest in industries and get incentives, imports go up a lot," he said. Are gone
He said that if there is comprehensive growth, if the purchasing power of the poor and middle class is increased, it will increase the local and agricultural production but the import bill will not increase because when the princes spend, it has more imported goods. While the poor person spends on things like flour, pulses etc.
The Finance Minister said that 80% of the industries in the country are for imports and local sales, not for exports, therefore efforts would be made to get most of the industries for export.
"As energy has become more expensive, our industries are out of competition and shut down due to lack of energy supply," he said. It was further reduced in February.
He said that now we are supplying gas to every industry but if the previous government of PML-N had done energy deals like in previous days if it had done such deals in the days of Kod then today electricity, petrol prices would have gone up. Maybe less.
He said that those who say that landmines were laid were not only for PML-N or coalition government but for the state of Pakistan, today the economy is not of PML-N, PPP but of Pakistan. Is getting worse
He said that foreign direct investment in the first nine months of the current financial year is one and a half billion dollars which was 2 billion dollars in the year 2017-18. The current account deficit is also high today.
Muftah Ismail said the Corona virus epidemic was a great opportunity because after that the prices of oil, gas and ghee dropped which was left by the previous government.
He said that the code caused loss of life all over the world but did not cause any economic loss to the state of Pakistan. In other words, you got many benefits from all over the world, but you did not improve your financial situation with these benefits.
He said that we also have to import wheat today and 3 million tons of wheat will be imported this year for which the first approval has been given to negotiate with Russia. This was the wheat that was exported in 2017-18. Were.
He said that in the same way last year we also imported sugar which we were exporting before, in many places Pakistan has lagged behind. This cannot be a coincidence but it is their fault.
He said that in 2017-18 when we had a tax rate of 11.1% of GDP but the PTI government could not touch this rate in its three years.
Muftah Ismail said that this year too it will not reach 11.1 but is unlikely to reach 8.5 per cent while for such a large nuclear power country the tax to GDP rate and export rate should not be less than 15 per cent.
The Finance Minister said that our imports have increased by 50% this year but the problem in Pakistan is not that our imports are high but the problem is that our exports are not high.
Growth rate
According to the Economic Survey for the year 22-2021, the GDP growth rate increased to 5.97% in the fiscal year 2022. However, the basic aggregate economy is still suffering from imbalance and further domestic and international uncertainties. Facing stability.
Pakistan economy continued to recover despite the Corona epidemic (0.94% contraction in FY2020) and a growth rate of 5.74% in FY2021.
The world, which is still struggling to cope with the effects of Code 19, is in a precarious economic situation due to the proliferation of Omekron, the change of government in Afghanistan and the Russia-Ukraine conflict.
In FY 2022, GDP at current market prices stood at Rs. 66.95 trillion, up from Rs. 55.796 trillion last year, an increase of 20.0%, while in dollar terms, the increase is 83 3.83 trillion.
In fiscal year 2022, per capita income was recorded at 79 1,798, reflecting an improvement in prosperity.
During the current financial year, the growth rate of agriculture sector was 4.4% while industrial sector recorded an increase of 7.2%, construction sector 3.1% and services sector 6.2%.
Trade deficit
According to the Pakistan Economic Survey, despite encouraging export performance, the country's imports have also increased significantly. Paid
As a result, the trade deficit widened to 55.5 percent to .1 30.1 billion, or 8.6 percent of GDP, which the document called "historically too high."
According to the survey, during July-March FY 2022, exports of goods increased by 26.6% to 23 23.7 billion, while exports of services increased by 17.1% to 1 5.1 billion.
According to National Accounts data, exports of goods and services increased by 39% in fiscal year 2022, while imports of goods and services increased by 46%.
According to the Economic Review report, the rise in global commodity prices is putting pressure on imports by significantly increasing import payments, partly due to a large trade deficit of 32 32.9 billion during July-April 2022. Remittances from Pakistanis living abroad were financed.
Inflation
On an annual basis, from July to April of the current financial year, inflation reached 11% against the target of 8%.
The report cited rising commodity prices, especially crude oil and edible oil, as the reasons for the rise in commodity prices at the local level.
The report said that in terms of the sector, the main factor in inflation was the high cost of transport, followed by home appliances, maintenance, housing, water, electricity and gas.
It added that non-perishable food items, in general, play a key role in fueling food inflation.
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