Pakistan’s economy: IMF projects low GDP growth, high inflation, unemployment

WASHINGTON: Improving US-China trade tensions have eased uncertainty and the world economy may have hit bottom but a sharp slowdown in India is creating a drag worldwide, the International Monetary Fund said on Monday.

However, while the risks to the global economy have lessened, the Washington-based global lending institution cautioned that outcomes "depend to an important extent on avoiding further escalation" between Washington and Beijing.

In the latest update to its World Economic Outlook, the IMF cut the global growth estimate for 2020 by one tenth compared to the prior report released in October, dropping it to 3.3 percent.

It also lowered the 2021 forecast by a bit more to 3.4 percent. The sharp drop for India "accounts for the lion’s share of the downward revisions," the IMF said. The new IMF Economic Outlook projects Pakistan GDP in 2020 at 2.4 percent.

The report said that in2018 the GDP growth of Pakistan was 5.5, in 2019 it was 3.3 in 2020 it will be 2.4. The consumer prices index (inflation) in 2018 was 3.9, in 2019 7.3, in 2020 it will be 13.

Current account deficit in 2018 was -6.3, in 2019 4.6, in 2020 it will be 2.6.

Unemployment in Pakistan in 2018 was 6.1, in 2019 6.1 while in 2020 it will be 6.2.

In India the GDP growth in 2018, 2019 was 6.8, 6.1 respectively while in 2020 it will be 7.0. Inflation in India in 2018 and 19 was same i.e.3.4, while in 2020 it will be 4.1.

In Bangladesh GDP growth in 2018 was 7.9, in 2019 7.8, while in 2020 it will be 7.4. Inflation remains almost constant in the regional Muslim country at 5.6, 5.5, 5.5 in 2018, 19 and 20 respectively. The current account deficit in Bangladesh was –2.7 in 2018 –2.0 in 2019 while projected to be at –2.1 in 2020. However, the IMF report sees light at the end of the tunnel about Pakistan economy as it projects GDP growth at 5, inflation at 5, current account deficit at -1.8 in 2024.