Pakistan Revises FY25 GDP Growth Expansion Higher to 3.04%
Pakistan hiked its economic growth for the fiscal year ended in June even as the recent floods are likely to drag the South Asian nation’s economy this year.
Gross domestic product expanded 3.04% in the year ended June, Pakistan Bureau of Statistics said Wednesday on its website, compared with the earlier estimate of 2.7%. For the April-June period, the economy grew at 5.66%, higher than the 3.1% expansion predicted by economists in a Bloomberg survey.
The government has projected an expansion of 4.2% for the current fiscal started July, a target that looks challenging after floods triggered by heavy monsoon rains submerged a vast swathe of farm land and displaced three million people.
About 7.7% of the total cropped land in the country have been impacted, damaging mainly rice and sugarcane. The floods also left over 1,000 people dead and as many injured.
Prime Minister Shehbaz Sharif has also called for the International Monetary Fund’s to factor the impact of the natural disaster in its latest loan review. An IMF team is in Islamabad for the review of the next tranche of $1.1 billion.
In the last quarter of previous fiscal year, farm production grew by 0.18%, industry’s by 19.95% and services by 3.72%, according to the bureau.
The expansion in industrial sector will continue in the current fiscal year, though the impact to agriculture output from recent floods will slow the nation’s annual economic growth, Mohammad Sohail, Chief Executive Officer at Topline Securities said. “The trend of industrial recovery will continue but the year-end GDP will be around 3.5%.”
Pakistan’s economy has stabilized following the the IMF’s $7 billion loan program as the government exercised fiscal discipline and plugged leakages with reforms. Rating agencies including Moody’s Corp., Fitch Ratings Inc. and S&P Global Inc. have taken note of the improved financial condition by upgrading the country’s credit ratings.
