ISLAMABAD: The World Bank has revised Pakistan’s growth rate upwards to 5.2% for fiscal year 2017 and 5.5% for 2018.
It previously estimated growth in Pakistan’s gross domestic product (GDP) at 5% and 5.4% for FY17 and FY18, respectively.
The report ‘Global Economic Prospects; weak investment in uncertain times’, states that the uptake in activity is spurred by a combination of low commodity prices, increasing infrastructure spending, and reforms that lifted domestic demand and improved the business climate.
In Pakistan, growth is forecast to accelerate from 5.5% in fiscal year 2018 to 5.8% in fiscal year 2019-20, reflecting improvements in agriculture, infrastructure, energy and external demand.
The report further mentioned the successful conclusion of the IMF Extended Fund Facility (EFF), aimed at supporting reforms and reducing fiscal and external sector vulnerabilities, lifted consumer and investor confidence.
The China-Pakistan Economic Corridor (CPEC) project is also tipped to increase investment in the medium-term, and alleviate transportation bottlenecks and electricity shortages.
Earlier in November, whilst releasing its report ‘Pakistan Development Update – Making growth matter’ the World Bank had projected Pakistan’s economy to grow at 5% in the ongoing fiscal year, meaning that the country was to miss the government-set target of 5.4%.
The Washington-based lender, in that report, added that the country’s economy could see a growth of 5.4% in FY18 on the back of continued mushroom growth in the services sector, recovery of agriculture and uptick in infrastructure investment.
“The services sector, which comprises more than half of the economy, is expected to be the primary source of growth,” stated report.
Additionally World Bank Country Director for Pakistan, Patchamuthu Illangovan, has stressed on the need for increased investment in social sectors like health, education and nutrition. “All this would lead to a vibrant and dynamic society as well as the economy,” he has stated.
With additional input from APP
Published in The Express Tribune, January 12th, 2017.