Economic growth

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Pakistan’s economy has made significant progress reflecting a blend of stabilization and structural reforms despite being challenged at economic and geo political front and is moving on a positive growth trajectory. Micro Small and Medium Enterprises (MSMEs), that use e-Commerce platforms, are around five times more likely to export than those in the traditional economy and the policy aims to pave the way for holistic growth of e-Commerce in the country by creating an enabling environment in which enterprises have equal opportunity to grow steadily.
Despite the 2018 worst balance of payment crisis, economic problems due to COVID-19, high commodity prices in international market and direct and indirect impact of humanitarian crisis in Afghanistan, Pakistan was expected to achieve over 4% economic growth – which is a major success. Since the government inherited huge circular debt, ant-exports policies, unstable financial conditions, less-competitive business environment and the policies of lower incentives for private sector, the present government’s three years. Pakistan as compared to other countries of the region demonstrated exceptional performance in confronting the COVID—19. The government’s policy of smart lockdowns, incentives for construction industry, social protection program and subsidy for Small and Medium Enterprises (SMEs) helped move the economy forward on sustainable pace – a fact also appreciated by analysts at global level. Under a comprehensive plan to uplift country’s overall economic situation, the government has made a large number of steps to minimize the impact of increase in the price of essential items and the government’s economic achievements over the last three years.
The strong measures taken for economic stabilization after successfully coming out of the fiscal crisis inherited from the previous government, Pakistan compared to other regional countries realized more economic progress even during the COVID-19 situation. With 25% growth in exports and the highest ever 38% increase in tax revenue, the country also recorded an increase of 27% in remittances. Moreover, with record incomes in agriculture sector – transfer of an additional income of Rs. 1100 billion to farmers, record Rs. 900 billions of profit in industrial sector, development of Information Technology (IT) sector due to government’s policy and after the successful tariff negotiations with Independent Power Producers (IPPs), a downslide has also been witnessed in the monthly [power] circular debt. In addition to the above, the government fulfilled its promise of a welfare state by launching the biggest social safety program under Ehsaas, brought institutional reforms and successfully complied with Financial Action Task Force (FATF’s) conditions which saved the country from going into the blacklist. There are proposals to mitigate the transfer of the effects of high global commodity prices to common people.
The proposals included an increase in incomes, purchasing power of the people, subsidies focused on middle and lower income classes and expansion of social safety net. In this regard the concerned departments to coordinate and implement the long term and short term plans for further betterment of both macroeconomic condition of the county and improvement in economic condition of the people. There is a lot of scope to increase exports in Information Technology (IT) from non-traditional sector at present. The current annual $ 2.5 billion IT exports are very low. Pakistan’s exports can now be boosted by focusing on some of the non-traditional sectors from the traditional export sector including textile. There is a need to promote export culture in the country at present and the government wanted to increase exports on priority basis.