The economy of Pakistan will grow at the rate of 4.2% during the current fiscal year against the government target to get the growth rate at 4.8%, Fitch forecasted.
In the current international scenario, this rate too is appreciable if the government of Pakistan succeeds in achieving it. Fitch Solutions is an international research organization according to which “We also expect to be buoyed by accommodative monetary and fiscal stance; public spending. A more assured economic outlook will bode well for consumption and investment, bolstering economic growth.”
Due to the encouraging investment atmosphere, good monetary and fiscal policies, decreasing cases of coronavirus in the country, government’s determination to vaccinate the majority of the people, banks’ elastic loan policies, etc would be helpful in achieving the 4.2% growth rate of GDP during the current financial year.
The research organization comes with the opinion, “With the government likely to continue with its ‘smart-lockdown’ strategy instead of imposing a nationwide lockdown, we do not expect Pakistan’s growth trajectory to be severely curtailed.”
In a report, titled, “Pakistan Economic Recovery to Continue in FY 2021-22”, Fitch presented its viewpoint about the private consumption that it would rise. The organization says that people’s confidence in spending has increased. Purchase of major items such as vehicles has enhanced greatly as compared to the pre-Covid-19 period.
Moreover, Fitch is confident that the level of foreign remittances will go up. It says, “We have also revised up our forecast for gross fixed capital formation (GFCF/investment) growth to 8% in FY22 from 7.2 % previously.”
GFCF will be driven by the battering domestic and global demand along with the supportive monetary and fiscal policies. The public sector’s spending will be producing a comfortable atmosphere for the economic growth of the country. In the current budget, allocation to the Public sector Development Program was increased by 61.3% as compared to the amount, fixed during the budget of the outgoing fiscal year.