After denying it for weeks, the government has finally admitted that economic growth for the recently-concluded fiscal year is expected to be around 3.3% – the worst in years – breaking the myth of economic revival in the first year of the Pakistan Muslim League-Nawaz (PML-N) government.
The admission, however, was only made in front of the International Monetary Fund (IMF).
“We now expect that the GDP will expand by about 3.3% in fiscal year 2013-14,” the government said in the Memorandum of Economic and Financial Policies (MEFP) which it submitted to the international lender on June 19.
Publicly, the government has maintained that the growth in 2013-14 stood at 4.1%. The figure was announced as the preliminary growth rate for the previous fiscal year and published in the Economic Survey of Pakistan 2013-14 as well as the State Bank of Pakistan’s (SBP) quarterly report released yesterday. The government has yet to share the actual growth rate with people and Parliament.
Pakistan needs an annual growth rate of over 7% to accommodate the bulk of youth that is entering the market every year but remains jobless due to limited economic opportunities, according to the Planning Commission of Pakistan.
The government shared its fresh estimates of economic growth with IMF two days before the budget was approved by Parliament but never shared these details, either with lawmakers or the federal cabinet.
The MEFP was attached with the letter of intent (LoI) the government submitted to IMF while seeking approval for the fourth $555 million tranche of the $6.5 billion loan programme. The LoI is jointly signed by Finance Minister Ishaq Dar and SBP Governor Ashraf Wathra.
The rate mentioned in the MEFP is even lower than the 3.7% growth achieved by the Pakistan Peoples Party (PPP) government in its last year in power. The figure was then the lowest rate in five years.
The 3.3% growth rate is in line with IMF projections but even lower than the estimates of the Institute for Policy Reforms (IPR) which had predicted 3.5% growth rate. The government had vehemently contested IPR’s estimates.
The government has delayed the scheduled release of the third quarter GDP figures – perhaps to hide dismal economic performance – and decided that it will announce in October this year.
The Express Tribune tried to contact finance ministry spokesman Rana Assad Amin and Asif Bajwa, chief statistician of Pakistan Bureau of Statistics. Neither of them responded to questions regarding why these estimates were not shared with Parliament and the reasons behind hiding this information.
“In my budget speech, I had predicted that very soon the government’s own documents would disclose that the economic growth rate was not 4.1% in fiscal year 2013-14,” said Pakistan Tehreek-e-Insaf’s (PTI) financial wizard and member of the National Assembly Asad Umar.
He said his party will move a privilege motion in the lower house. “By concealing facts from the National Assembly, the government has breached the privilege of the lower house of Parliament,” the PTI MNA added.
The government has also misled Parliament and the federal cabinet when it came to growth estimates for fiscal year 2014-15. It got a growth rate of 5.1% approved from the National Economic Council and shared the same with Parliament.
But according to the MEFP, “in the next fiscal year, expansion should accelerate to 4%,” as downside risks to growth remain. The government’s 4% growth estimates are in line with the IMF’s projections that also see a growth rate of around 4% in the current fiscal year.
Published in The Express Tribune, July 11th, 2014.
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COMMENTS (39)
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So this government is after all worse than the previous one:
Growth rate 2013-14: 3.3% Growth rate 2012-13: 3.7%
And certain quarters of media continue to treat these corrupt rulers with bias to the point of sycophancy.
First Scenario: Trying, failing, admitting and then trying again Second Scenario: Not trying, failing, concealing and making nation fool PML-N would be acceptable for me in first scenario. But in current scenario, all I can say about this government is: "A government of Liars, by the Liars for the Liars" :) Sooner we get rid of them, the better
It was projected as 4.1 few months ago. Things went wrong and now projected as 3.3. I don't think anyone lying here.
@Taimoor: hahaha
@Shuaib: not at all....the numbers were clearly fudged and many bodies in Pakistan had highlighted it earlier; but the media had not highlighted it. Now this has been admitted by Dar and the SBP under their own signatures.
Worst growth rate in many years.
@Zaida Parvez: I am not sure about that. The Chinese are too shrewd not to know. But given the "higher than the mountains... blah", they say nothing!
wow this was first of PLM -N ..i will happen for 5 years so people don't cry now.
@Bilal:
Punjabi will remain Punjabi.......unfortunately hypocrites in today world are considered smart people who take advantage of instant situation..... Nawaz league did just that.
i am missing Malik Pur Janderbari from Abbottabad.Lolz
Is anyone else on this thread missing Adnan Siddiqui? :(
Artical 6 of constitution be invoked for bring the name of country into disrepute
Only China pretends to believe anything Pakistan says. The rest of the world laughs behind the back.
The initial number of 4.1% was just a bait. Mr.Dar could then modestly reduce it and still end up with a half decent number. The true growth rate will most likely be negative. Mr.Dar has a long history of cooking up numbers.
wow how pathetic this makes me feel .after 4.1 growth publicised by the govt i was optimistic about the future .the nerve of these people to lie to the nation such blatently .i was wary of mr imrans agenda but after this i guess i will also be supporting imrans FREEDOM MARCH!
If Economic Survey of Pakistan is figures are not correct then the governments should get rid of this institution to save money.
62-63 on Ishaq Dar too!...PTI please file another application with ECP. Lets get rid of them
We are become like liers in the international media,what a shame !
@Shuaib: Wake up please, Please, please. This is not what IMF measured. Read the article again. This is what the Govt told IMF that their actual growth rate is 3.3% (.4% lower than PPP's worst year. This was the rate PML N was concealing from Parliament even. This is the same parliament PPP and PML N wants PTI to come to and not do Azadi March. Insane People will continue supporting these blatant liars and thieves.
Making fools of others sometimes become fool itself. Dar needs grooming to run the finance ministry. Fudging figures and showing wrong facts are key success to his life. Fiscal deficit is far greater than what he claimed for. Unfortunately this will happen again and again. Take my word these people will default the country when its time to pay off these loans. No clear direction to improve exports. In my view Nawaz Sharif must have started Dasu & Basha dam construction on war basis. Small micro hydel power must be constructed parallel to these projects. No need to make motorways or laptop distribution as this is not a priority. Anyways these things are only understand by patriotic people rather than agents.
If Dar becomes finance minister than anybody can become.
Secretly allowing the drone strikes and criticizing it in public: PPP Telling the nation that GDP for FY 2013-14 remains 4.14% and confessing to IMF that it was 3.3%: PML-N And these people are ruling us for the past 25-30 years! We are doomed as a nation!
@Taimoor: Yes of course you are right... ask your father to stop playing with the country just to be PM.
People even quarrel to defend n league, recently enjoying the name of Gullu League, keep praising metro bus and continue with looting Pakistan ........ reality though hard to swallow
Is this the government that people have so valiantly defending in the wake if 14 August? Seriously, goes to show the level of intellect our liberals and democrats actually possess.
Bunch of liars - From Najam Sethi to Ishaq Dar
Its only a matter of time for getting money , money and money and let nation be a fool.. This is call of this Government. They wanted to hide the truth now its own their face and they are hiding from it.
So Ishaq Dar basically lied to the whole nation. So now since the budget is based on obviously fraudulent figures the whole exercise is meaningless and should be revised
We already knew it. The policy of lie and hide is not new for Govt of Pakistan. And there are claims of democracy in Pakistan.
So, apparently, building metros and motorways isn't taking our gdp anywhere. Wish his economic wizards and Mr. Sharif himself understood that.
What a blatant disregard of the sanctity of the government. How are we the public supposed to believe anything that the government says? For all we know everything maybe concocted fantastical figments of imagination of someone in the government.
PTI please let the government work, they are shattering records left and right.
Liar liar, who is the pseudo intellectuals
That is very interesting. I think IMF measures growth rates differently. I remember IMF saying India's growth rate was over 2-3% less than India's official figures and it was also less than what the World Bank publicly acknowledged that India had grown which was more in line with India's official growth rate.
What fools we are .. we thought PMLN and Ishaq Dar has learnt something ... just like before Ishaq Dar lies fudges numbers
I'm up for the revolution/azadi/tsunami march or whatever gets me rid of these liars!
And the load shedding will end within six months of nawaz government. I would really like to meet the people who actually believe what this government has to say,
Hypocrate always speaks lie was told to us by Allah messenger 1400 years a go