Pakistan set to achieve 6pc GDP growth this year

ISLAMABAD: Pakistan aims to boost its gross domestic product (GDP) by around 6% this fiscal year, due to improved performance in the industrial and services sectors.

While differences between the Ministry of Finance and the Ministry of Planning and Development over the assessment of provisional GDP continue, the government expects to calculate GDP growth in the range of 5.7 percent to 6.2 percent for this fiscal year.

As Pakistan's GDP growth hovers around 6%, macroeconomic imbalances such as budget and current account deficits resurface the country's history of boom and bust cycles will repeat itself.

The government is expecting a budget deficit of over Rs5 trillion and a current account deficit of $16-$17 billion, according to official sources.

According to the Ministry of Finance's economic advisory wing, projected GDP growth for 2021-22 might reach 4.2 percent.

The Ministry of Planning, on the other hand, predicted that provisional GDP growth would easily exceed 5.5 percent.

With large-scale manufacturing (LSM) growing at double-digit rates, limiting overall GDP growth to less than 5% is difficult. The country's GDP was Rs55.8 trillion in the latest fiscal year, after the rebasing of national accounts from 2005-6 to 2015-16.

Now it is estimated that the size of the economy might touch Rs63.8 trillion for the current fiscal year or it might cross it because the nominal growth (GDP growth plus inflation) will be gone up by around 19 to 20% for the current fiscal year.