PTI achieves lowest GDP rate of 3.29pc since 2010-11

ISLAMABAD: The PTI led government has achieved provisional GDP growth rate of 3.29 percent in outgoing fiscal 2018-19, one of the lowest in last nine years since 2010-11.

Pakistan’s size of economy has shrunken massively and dropped to around $280 billion in 2018-19 from $313 billion last year in 2017-18 mainly because of massive devaluation of 34 percent in exchange rate. The depreciation of rupee against dollar has witnessed 34 percen slide since January 2018.

This dismally low Gross Domestic Product (GDP) growth rate of 3.29 percent has been achieved during the first year rule of PTI-led regime owing to bad performance of major crops in agriculture and negative growth in large scale manufacturing (LSM) sector.

Interestingly, the PTI government had revised downward the real GDP growth figures of last financial year from 5.8 percent to 5.2 percent under the PML-N regime but the National Accounts Committee (NAC) on Thursday again revised upward the real GDP growth of 2017-18 to 5.53 percent. So the growth has gone up during the last five years rule of PML-N but in first year tenure of PTI it nosedived to lowest of last nine year by standing at just 3.29 percent for 2018-19.

Former Finance Minister and reputed economist of Pakistan, Dr Hafeez A Pasha told The News on Thursday that in such low growth rate the agriculture and large scale manufacturing (LSM) could not grow at desired pace, adding around 4 million people have fallen below the poverty line and one million have become jobless and unemployed in Pakistan.

The construction sector achieved negative growth of 7.57 percent during first year rule under PTI led regime in 2018-19. Alarmingly, the agriculture sector which contributes into national economy to the tune of 19 percent, has grown by just 0.85 percent with negative growth of major crops due to decline in production of cotton, rice and sugarcane by negative 17.5 percent, 3.3 percent and 19.4 percent respectively. Only wheat crop has grown at rate of 0.5 percent only.

The large scale manufacturing has achieved negative growth of 2.06 percent in fiscal year 2018-19. The National Accounts Committee (NAC) meeting held under chairmanship of Secretary Ministry of Planning Zafar Hasan here on Thursday in which the provisional GDP growth rate for fiscal year 2018-19 is estimated at 3.29 percent, the growth of agriculture, industrial and service sectors is 0.85 percent, 1.4 percent and 4.71 percent respectively. The GDP growth rate for last financial year 2017-18 stands at 5.53 percent against initial estimates of 5.79 percent which were lowered down to 5.2 percent through constituting a committee by PTI led regime couple of months back.

The agriculture sector grew by 0.85 percent. The crop sector has witnessed negative growth of 4.43 percent during 2018-19. The important crops has achieved negative growth of 6.55 percent due to decline in production of cotton, rice and sugarcane at negative 17.5 percent, 3.3 percent and 19.4 percent respectively. While wheat crop has grown at 0.5 percent, the growth rate of maize is 6.9 percent. Other crops show growth of 1.95 percent because of increase in production of pulses and oil seeds. Cotton ginning has declined by negative 12.74 percent due to decrease in production of cotton crop. Livestock sector is showing growth of 4 percent while growth of forestry is 6.47 percent due to increase in production of timber in KP 26.7 to 36.1 thousand cubic meters.

Industrial sector’s provisional growth has been estimated at 4 percent. The mining and quarrying sector has witnessed a negative growth of 1.96 percent mainly due to natural gas (-1.98 percent) and coal -25.4 percent. The large scale manufacturing (LSM) is derived from QIM data which shows a decline of 2.06 percent. Major decline has been observed in textile by negative 0.27 percent, food, beverages and tobacco by negative 1.55 percent, coke and petroleum products negative 5.50 percent, pharmaceutical negative 8.67 percent, chemicals negative 3.92 percent, non metal mineral products -3.87 percent, automobiles -6.11 percent, iron and steel products by negative 10.26 percent.

The major positive growth in LSM has been observed in electronics 34.63 percent, engineering products 8.63 percent and wood products 17.84 percent. The electricity and gas sub sectors has grown by 40.54 percent due to Wapda and companies and IPPs. The construction sector has decreased by negative 7.57 percent due to conservative construction related expenditures reported in rest of the economic activities.

Services sector has grown provisionally at 4.71 percent. The wholesale and retail trade grew at rate of 3.11 percent. It is dependent on the output of agriculture and manufacturing as well as on imports. The improvement has been observed in livestock and imported products.

The transport, storage and communication sector has registered a growth of 3.34 percent due to positive contribution of Railways 38.93 percent, air transport 3.38 percent, and road transport 3.85 percent. Finance and insurance sector shows an overall increase of 5.14 percent while central banking has declined by 12.5 percent. A positive growth has been observed in scheduled banks with 5.3 percent growth, non scheduled banks 24.6 percent and insurance sector 12.8 percent. The government services has grown by 7.99 percent and it’s mainly driven by increase in salaries of federal, provincial and district governments. Other private services, which is composed of various district activities such as computer related activities education, health and social work NGOs etc. has been contributed positively at 7.05 percent.