March 20, 2022: Due to the robust growth of the country’s large-scale manufacturing, agriculture and exports, Finance and Revenue Minister Shaukat Tarin expressed hope on Sunday that gross domestic product (GDP) growth would exceed five percent relative to of the stated target of 4.8 percent for fiscal year 2021-22.
“The welcome news is that LSM grew 8.2% in January from the same month last year and 4.2% from December 2021,” he said at a press conference here.
He said LSM growth had slowed in August, September 2021, but the good news was that it had returned to high growth levels.
“Our economic growth momentum has picked up again as all of our agricultural crops are growing at 6 to 12 percent and the export and service sectors are also growing at a rapid pace,” he said.
Tarin said there were undoubtedly headwinds, such as inflation and the current account deficit, but growth was sustainable and robust.
He said that in order to curb inflation and communicate a minimal impact of international inflationary pressures to the masses, the government had taken several measures, including a significant cut in the prices of petroleum products and electricity.
The minister emphasized that as a result of such measures, weekly inflation based on the Sensitive Price Index (SPI) fell by 1.15 percent in one week.
Regarding the recent global happiness index released by a United Nations agency, the minister said Pakistan’s happiness index had improved by seven points in one year, but India’s had fallen by three points.
He said the elements on which the index was based included perceptions of corruption, social support, freedom of choice, gross domestic product per capita, life expectancy and generosity.
In Aisa, he said Pakistan was among the top 15 happiest countries.
The finance minister added that the current account had been in a high deficit for several months, but now as a result of the government’s measures to curb imports and increase exports, the deficit has shrunk significantly from over two billion. dollars in January to just $545 million in February.
Our reserves at the central bank were close to US$16.6 billion, so there was no reserve pressure like in the past when reserves were quickly depleted after a high current account deficit.
Responding to a question regarding ongoing talks with the International Monetary Fund (IMF) to release the next tranche of the program, the minister said the IMF had expressed concerns about the Pakistani government’s recent support in the area. of petroleum products and electricity. However, he said: “We have satisfied them by showing how we will manage the fiscal space”.
He said the IMF had asked us to show the agreements and evidence how the subsidized money would be managed.
“This is not a big problem as we have done our homework and my last meeting with the IMF would be Tuesday,” he said, adding that the IMF should have no reason to stop the next tranche.
In response to another question about Pakistani Muslim League-Nawaz leader Miftah Ismail’s press conference yesterday, the minister said, the government did not issue a Eurobond at this time due to high interest rates. “Once the international markets calm down and rates return to normal, we will issue the bonds.”
He said Miftah Ismail was wrong in comparing the current current account situation with that of 2018, and said that in 2018 Pakistan’s foreign exchange reserves were at their lowest level and that they had enough reserves to support imports of only one month to pay.
“He thinks people’s memories are very short,” the minister said, adding that dreaming big would only be good for his own health and nothing else.
On another question, the minister said wheat production would grow by 5 to 6 percent this year and the government may not need to import it next year. However, he said that in order to increase strategic reserves, the government could import 500,000 tons of wheat.
Posted on: 2022-03-20T17:45:22+05:00
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