An overview of the National Economy

Engineering Post Report

Pakistan’s economy is moving  progressively on higher inclusive and sustainable  growth path on the back of various measures and achievements despite  myriad of challenges during the financial year 2020-21.

According  to the information gathered from the official sources concerned in Islamabad,  major achievements highlighting the economic performance during FY 2021 are briefly mentioned below:

Pakistan was implementing  stabilization  policy post crisis of 2017-18 and the national economy was recovering from macroeconomic imbalances but COVID-19  slowed down  the pace which was recovered  initially but the advent of second and third wave of the pandemic one after the other brought the significant challenges which were, however,  met by the timely prudent policies by the incumbent federal government through its implementing organizations and agencies down the line.

Pandemics like COVID-19 are once in a century event that devastated  global economies, but Pakistan had done much better in coping with the pandemic of Corona Virus as compared to many countries around the globe.

The federal government took several measures important policy decisions: monetary and fiscal measures, smart lockdown, rapid vaccination etc , National Command and Operating Centre (NCOC) as a single organization  was made  responsible to take key decisions in collaboration with the provinces. Situation was put under control  due to the federal government’s  timely decision making as a result of which the numbers of daily COVID-19 cases are presently showing declining trend.

Prior to COVID-19, the working population of the country was 55.74 million. The number declined sharply to 35.04 million  which indicated that either the people had lost their jobs or were not  able to work. However, due to prudent decisions by the federal government, working population had reached 52.56 million  till October 2020.

National economy has witnessed a V-shaped recovery.  The current  economic recovery , it is pertinent to mention,  has been achieved without compromising internal and external stability of the country.

Current account posted a surplus of $ 0.8 billion during July 2020-April 2021 period for the first time in 17 years.

Inflows of foreign exchange through the Roshan Digital Account (RDA) crossed the $ 1 billion mark. During July-April FY 2021, workers remittances posted historically high growth of 29 per cent reaching to the level of $ 24.2 billion.

Foreign exchange reserves with the State Bank of Pakistan rose to $ 16 billion mark, four years high.

Keeping in view the significant performance pertaining to Financial Action Task Force (FATF) conditions, potential pf exports and e-commerce, Pakistan has been added  into the Amazon’s seller list.

Due to its impressive  growth,  Pakistan Stock Exchange  earned the title of being the best Asian stock  market and the fourth best performing  market across the world  in 2020.

Profile of domestic debt  has improved significantly during the tenure of  the present government as short-term debt as percentage of total debt has decreased  to 23 per cent at the end of March 2021 compared with 54 per cent at end June 2018.

Over 80 per cent of the net borrowing  from domestic sources  was through  medium-to-long term domestic  debt instruments i.e. Pakistan Investment Bonds & Government Ijara Sukuk during first nine months of FY 2021.

Pakistan has entered the international market  after a gap of over three years by successfully  raising $ 2.5 billion through Euro Bonds.

The policy rate has remained unchanged at 7.0 per cent which led to improved  business sentiments and the stimulating economic activities enabling  employment to recover.

Cellular mobile subscribers (number of active  SIMs) in Pakistan have   reached 182 million at the end of March 2021 as compared to 167.3 million by the end of June  2020 showing an increase of 8.6  in nine months of FY 2021.

At end of March 2021, broadband (BB) subscribers reached to 100 the end of March 2021 as compared to 167.3 million by the end of June  2020 showing an increase of 8.6  in nine months of FY 2021.

At end of March 2021, broadband (BB) subscribers reached to 100 million. The total  BB  penetration in Pakistan as such stood at 47.6 per cent in March 2021  registering an increase  of about  19.7 per cent as compared to end March 2030.

International Monetary Fund (IMF)  has acknowledged  that the incumbent  federal government policies  have been critical  in supporting  the national economy  and saving  lives as well as livelihoods. The IMF and Pakistan  have announced  the resumption of stalled $ 6 billion loan programme. During the period under report, all three major credit rating agencies i.e. Moody’s, Fitch and Standard a& Poor’s have reaffirmed  their sovereign  credit ratings for Pakistan. This reaffirmation is reflective of  the sound policies of the incumbent federal government  and of the confidence  reposed by these leading international institutions in the country’s economic outlook.