Aziz sees key economic indicators flashing green

ISLAMABAD: Sartaj Aziz, deputy chairman planning commission, on Wednesday said the key indicators of the first quarter of 2017-18 with respect to large scale manufacturing and agriculture were encouraging, while overall GDP growth rate was expected to be close to the target of 6 percent this fiscal year.

“The most positive indicator for Pakistan’s economy is the last fiscal year’s GDP growth rate of 5.3 percent, which is the highest in nine years,” Aziz said speaking at the second National Conference on Emerging Macroeconomic issues in Pakistan organised by National University of Modern Languages.

“The inflation rate in past three years has been 4.5, 2.9 and 4.2 percent compared to 8 percent in the preceding years and this is partly due to the decrease in oil prices but increase in revenues has also contributed to lower inflation.” The deputy chairman continued that the consolidated fiscal deficit as a percent of GDP has declined from 8.2 percent in 2012-13 to 5 percent in the past two years and tax to GDP ratio has also gone up from 9 percent to 12.5 percent during this period.

“Against these positive indicators, the balance of payment situation has deteriorated as exports declined to $21.7 billion from $24.7 billion in 2016-17 while imports jumped from $40.2 billion to $48.5 billion in the same period,” Aziz added.

He, however, asserted the government had taken measures to reduce imports and encourage exports to improve the balance of payment. While highlighting the two major achievements, Aziz said the visible improvement in security situation and virtual resolution of energy crisis had led to the revival of investment, evident from the record flow of Rs748 billion as credit to the private sector during current fiscal year.

“Interest rates are also lowest and stable. Many credit rating agencies have upgraded Pakistan’s ranking,” he added.

Speaking on China-Pakistan Economic Corridor (CPEC), he said the mega project was deemed to attract almost $60 billion in investment in the next eight to ten years for energy and infrastructure. “This will help end electricity shortfall and provide reliable support for domestic economic activities and exports,” the planning commission official added.