Pakistan's GDP expected to hit 4.8% next fiscal year: Asad Umar

The country's gross domestic product (GDP) growth is expected to move up to 4.8% in the financial year 2021-22, Federal Minister for Planning and Development Asad Umar said Friday.

Umar, going over the government's progress in the current fiscal year during a press conference in Islamabad, said in the nine months of the current fiscal year, IT exports showed growth of 46%.

Umar said the country had "witnessed a strong growth" during the fiscal year, and it is expected that the remittances would shoot up from $21.7 billion to $29.1 billion till the year end — an increase of 34% in a year.

The federal minister said if we combine the 3.94% GDP growth and the increase in remittances, it will take the gross national product (GNP) growth to 6.5% — the "highest" GNP growth in the last 16 years.

Umar said remittances played an important role in helping the country's economy grow, and it is important that we should give overseas Pakistanis the right to vote.

Next year's predictions

Shedding light on why the government is expecting a 4.8% GDP growth in FY22, he said that the government has invested in the agricultural sector which will greatly benefit the economy.

He said last year and this year cotton fields were badly affected, however, the government has now bought good quality seeds, stressed on the use of pesticides, and the demand for cotton has increased in the international market since.

"And so, after consultations with all the provinces, we have concluded that Pakistan can produce 10.5 million bales — 4 million from Sindh, 6 million from Punjab, and the rest from other provinces."

Umar said that the livestock industry had also been adversely impacted by coronavirus, but in the next fiscal year, it will move towards normalisation, and growth in this sector, too, will be visible.

The federal minister said electricity consumption was expected to grow by 6%, and after the government had announced a package for the industries, their power consumption had gone up 15% during the current fiscal — and in the next year, it is predicted to rise further.

Growth is also expected in gas, coal, construction, and among several other sectors. "Exports are predicted to go up. This year it stood at $25.2 billion, and in the next year, it will move up to $26.8 billion."

Govt eyeing historic exports next year

The federal minister said this year's $25.2 billion worth of exports were the country's highest figures in the last 10 years. "It is unfortunate that the backbone of the economy, exports faced several setbacks during the previous year."

Umar said next year's target for exports, $26.8 billion, would be the highest in the country's history.

The remittances might not grow like this year, but they are expected to move up from $29.1 billion to $31.3 billion — an expected increase of $2 billion.

Umar said the government was aiming at taking up the exports and expanding the IT sector, he said, adding: "The IT exports increased by 46%.

250 billion rupees increase in PSDP

The Public Sector Development Programme (PSDP) stood at Rs650 billion this year, and the government has increased it to Rs900 billion for the next fiscal year — a "huge" increase of Rs250 billion.

The federal minister said growth during the current fiscal year indicates that in the next fiscal year, the growth will be more than expected.

Giving an overview of the development spending for the next fiscal year, Umar said these envisage road infrastructure projects including Hyderabad-Sukkur motorway.

PSDP spending

Giving an overview of the development spending for the next fiscal year, Umar said these envisage road infrastructure projects including the Hyderabad-Sukkur motorway.

The packages announced for Karachi, and select districts of Sindh and Balochistan, and Gilgit-Baltistan will be financed from the PSDP, the federal minister said.

Similarly, funds will be provided from the development plan for the construction of dams. Rs28 billion will be allocated for health, Rs37 billion for the Higher Education Commission, and Rs5 billion have also been set aside for the skills education programme.

The planning minister said the current account deficit for the next fiscal year has been estimated at 0.07%.