Business

Pakistan’s pace of economic growth to slow down to 4% in FY22: ADB

Published

3 years ago

Farwa

ADB, however, says growth is expected to accelerate to 4.5% in FY23.
“Pakistan’s economy is recovering steadily due to well-coordinated fiscal and monetary responses to the pandemic,” ADB country director says.
Manilla-based institute notes that in FY22, industrial growth is forecast to decelerate.

ISLAMABAD: Following a remarkable economic rebound in the previous fiscal year 2020-21, the Asian Development Bank (ADB) projected Pakistan’s economic growth to slow down to 4% in the ongoing fiscal year 2021-22 amid tighter fiscal and monetary policies before picking up again in the fiscal year 2022-23.

According to the Asian Development Outlook (ADO), 2022 — ADB’s annual flagship economic publication — Pakistan’s gross domestic product (GDP) growth is projected to slow to 4% in FY22 from 5.6% in FY21 as the government applies measures to reduce the current account deficit, raise international reserves, and cut inflation.

“Growth is expected to accelerate to 4.5% in FY23 due to stronger private consumption and investment,” the Manilla-based institution projected.

Commenting on the forecast, ADB Country Director for Pakistan Yong Ye said: “Pakistan’s economy is recovering steadily thanks to well-coordinated fiscal and monetary responses to the pandemic.”

“These led to a remarkable expansion in the industry and services sectors. It is key to continue structural reforms along with appropriate fiscal and monetary policies to contain rising inflation and external imbalances. Comprehensive reforms in tax policy and administration are also critical to boosting revenues in order to fund essential public services. ADB is fully committed to supporting Pakistan’s sustainable development.”

The ADB further noted that in FY22, industrial growth is forecast to decelerate, reflecting fiscal and monetary tightening together with significant depreciation of the local currency, and upward adjustments to domestic oil and electricity prices.

Meanwhile, agriculture is expected to continue lending impetus to GDP growth supported by the government’s package of subsidised inputs and increased support prices of wheat and sugarcane.

The Manilla-based institution further added that inflation declined to 8.9% in FY21 but is expected to pick up in FY22 to around 11% due to higher international energy prices, significant currency depreciation, and elevated global food prices from supply disruptions.

As a net importer of oil and gas, Pakistan will continue experiencing strong inflationary pressures for the remainder of FY22 from the jump in global fuel prices resulting from the Russian invasion of Ukraine.

“Inflationary pressures are likely to be less pronounced in FY23, with inflation forecast to drop to 8.5% as fiscal consolidation progresses and oil and commodity prices stabilize,” the report mentioned.

Business

The amount of trade between Saudi Arabia and Pakistan hits $700 million.

Published

10 hours ago

Farwa

Through the Special Investment Facilitation Council (SIFC), Pakistan’s trade connections with Saudi Arabia have grown significantly, with bilateral trade volume rising from $546 million to $700 million and exports to the Kingdom growing by 22%.

As bilateral economic cooperation continues to grow, Saudi investors have shown a strong interest in Pakistan’s construction, energy, agricultural, and information technology sectors. The objective for exporting IT services between the two countries has been raised from $50 million to $100 million.

Saudi Arabia has set up a help desk dedicated to making it easier for Pakistani IT companies to register in the Kingdom in order to expedite commercial procedures. The goal of this program is to speed up economic collaborations between the two countries and lower administrative barriers.

The well-known Saudi restaurant chain AlBaik has revealed plans to open locations in Pakistan, which is a big step for the food service industry and should lead to the creation of new job possibilities in the area.

Officials have noted that stronger business links between the two countries lead to greater economic stability, and the SIFC has played a crucial role in promoting these trade advancements. For bilateral trade and investment projects, the Council remains a crucial facilitator.

According to a trade official with knowledge of the developments, “the establishment of dedicated support mechanisms, such as the help desk for IT companies, demonstrates a commitment to long-term economic partnership,” The goal of these programs is to improve the conditions for commercial collaboration between the two nations.

The increasing amount of trade and the diversity of investment sectors show that Saudi Arabia and Pakistan’s economic ties are changing as both countries seek to deepen their business alliances in a number of industries.

Business

After more than 50 years, Bangladesh and Pakistan resume direct trade.

Published

10 hours ago

Farwa

After more than 50 years, the two governments will resume direct bilateral trade, with Bangladesh’s food ministry announcing Sunday that it will receive a supply of 25,000 tonnes of rice from Pakistan next month.

After former Prime Minister Sheikh Hasina was overthrown last August, relations between Bangladesh and Pakistan have begun to improve after decades of tense relations.

Since then, there have been increased bilateral interactions between Bangladesh and Pakistan. Nobel laureate Muhammad Yunus, the interim government’s senior adviser, has met twice with Pakistani Prime Minister Shehbaz Sharif.

According to the food ministry, Dhaka completed an agreement earlier this month to import grains from Pakistan.

“On March 3, the first shipment of 25,000 tonnes will reach Bangladesh,” Zia Uddin Ahmed, a ministry assistant secretary, told Arab News.

“This is the first time that Bangladesh has started importing rice from Pakistan at the government-to-government level since 1971.”

Following direct maritime contact between the two South Asian countries in November—a Pakistani cargo ship stopped in Bangladesh for the first time since 1971 with imports and exports arranged by private companies—their trade relations grew.

Resuming trade with Pakistan is a significant step for Bangladesh, according to Amena Mohsin, a lecturer at North South University and a specialist in international relations.

“We want to see progress in our bilateral relationship with Pakistan. Most significantly, we are currently going through a low point dispute with India, even though we constantly diversify our partnerships.

This most recent move to purchase rice from Pakistan is really significant in this context,” she told Arab News.

Business

The total amount of Pakistan’s liquid foreign reserves is $15.95 billion.

Published

3 days ago

Farwa

As of February 14, Pakistan’s total liquid foreign reserves were $15,947.9 million, with the State Bank of Pakistan’s (SBP) holdings being $11,201.5 million.

Official figures for the week ending February 14, 2025, show that the central bank’s liquid foreign exchange reserves rose by $35 million to $11,201.5 million.

Commercial banks maintained net foreign reserves of $4,746.4 million during the period under review, according to the breakdown of foreign reserves.

The nation’s total liquid foreign reserves as of the week ending February 07, 2025, were $15,862.6 million.

Of these, the central bank held $11,166.6 million in foreign reserves, while commercial banks kept $4,696 million in net reserves.