Pakistani economic growth is expected to be subdued, averaging at 1.3 percent over the next two fiscal years, said the World Bank.
World Bank in its biannual flagship report Global Economic Prospects (GEP) 2021 has forecast that the growth rate of Pakistan will remain at 0.5% for the Financial Year, 2021.
The report says that the negative impacts of the Covid-19 were severer in South Asia and things are still out of control. Pakistan too was badly affected by the coronavirus.
The World Bank is expecting a rise in poverty in the country. The people who belong to the non-agriculture sectors were especially badly affected by the attack of the virus. Around 14 million people in the urban areas of Pakistan were put away from jobs and poverty is likely to increase for the first time in two decades.
According to the report, “The economic contraction is likely to have an impact on poverty”. The service sector is expected to be slower by around 1% and the industrial sector too is not likely to grow due to high policy rates prior to the pandemic and plunging domestic and international demand. The agriculture sector which could save itself from the hazards of the Covid-19 to a certain extent is likely to show the growing trend.
The World Bank report further says that the overall Pakistani economic growth is likely to move up. The second wave of the coronavirus could be the threat and the government may again opt for the steps of lockdown etc. which damaged the economy during the start of Covid-19 in February.
The locust attack and heavy monsoon could lead to widespread crop damage, food insecurity, and inflationary pressure and those attached with the agriculture sector may also be negatively affected.