State Bank of Pakistan (SBP) said Pakistan’s economy has maintained growth momentum in first quarter of fiscal year 2021/2022.
The present government is determined to achieve around a 5 percent growth rate in the current fiscal year despite the flood of rumors about the economy. The government claims that not only during the pandemic but even after the severity of Covid-19, its policies helped maintain a good level of the economy. Now the report of the State Bank of Pakistan about the economic performance of the country during the first quarter of the ongoing fiscal year confirms the government’s claim.
The report of the central bank says, “Both the supply and demand sides contributed to this momentum. Broad-based expansion in large-scale manufacturing (LSM) and improved Kharif crop outcomes reflected favorable supply-side dynamics; whereas strong sales of fast-moving consumer goods and cars, import volumes, energy consumption, and consumer financing, indicated buoyancy on the demand side.”
Prime Minister’s recent announcement to relieve the people with reference to the petrol and electricity was due to the surplus revenue, collected by the FBR during the current fiscal year so far. The report says that the increasing trend of global prices caused inflationary pressure on the economy along with widening the current account deficit.
About the working of Large Scale Manufacturing (LSM), the central bank’s report says that this sector grew at the rate of 5.1 percent during the period from July to September 2021 as compared to the growth rate of 4.5 percent during these months in the previous year. The agriculture sector also came ahead with appreciable performance as the production of rice, sugarcane and cotton showed the encouraging output.
Prime Minister Imran Khan has been particularly focusing on the development of the housing and construction sector so as to create maximum jobs in the country. The banks approved the loan worth Rs 72 billion under Mera Pakistan Mera Ghar (MPMG) scheme during the first quarter of the current financial year out of which Rs 16.97 billion were distributed.
SBP says that despite the encouraging level of foreign remittances and rising exports, increasing trend of international prices, and high level of imports due to the industrial activities, the current account deficit widened to $3.5 billion during the period, under review. SBP’s Monetary Policy Committee raised the policy rate by 25 basis points in its September 2021 meeting.
A number of other effective steps were taken to control the unnecessary imports. $849 million were received in Roshan Digital Account during the first quarter of this fiscal year and the total amount, received under this account by the end of September 2021, stood at $2.4 billion.