FAISALABAD: Pakistan has the potential for achieving strong economic growth till 2030, provided it successfully overcomes five major constraints it is facing currently.
The study conducted by the research and development department of Faisalabad Chamber of Commerce and Industry (FCCI) said that the country’s GDP purchasing power is expected to rise to a level of over $2,600 billion by 2030 with a potential to overtake Thailand.
Giving details of this study titled ‘Pakistan’s Economy in 2030 – Learning From Past’, former FCCI vice president and FCCI Standing Committee on R&D Chairman Engineer Ahmed Hassan said that Pakistan’s per capita GDP purchasing power is also expected to double by 2030, with a potential of rising from $5,145.7 in 2016 to $10,941.2 in 2030.
He said that this study was conducted by Research Associate Muhammad Ali Hassan, who has been working with Ahmed Hassan as an economist after completing his graduation from LUMS. He further stated that these projections only represent the economic growth potential of the country, however, the actual economic growth will depend on a variety of factors including possible future economic shocks and the policies adopted by the government in the coming years.
He also said that the report had also identified the key issues that needed to be addressed in order to ensure that Pakistan achieves its economic growth potential. Among these include institutional instability and corruption, high public debt and fiscal deficit, low-value addition in agriculture, lack of innovation and diversification in the manufacturing sector and low emphasis on human capital development, he added.
“The elimination of these constraints through expedient policies would ensure macroeconomic stability, strong institutions, openness to trade, and human capital development,” he said, adding that a sharing of the benefits of growth was essential to create an environment conducive for achieving sustainable and inclusive growth in the future.
Ahmed Hassan also said that the government should introduce policies for fiscal consolidation and ensure fiscal discipline in line with the guidelines provided by the FRDL Act 2005. “A key step for achieving this fiscal consolidation is a broadening of the tax base to increase tax revenues, which will help the government to avoid budget deficits thereby preventing the need to take further debt,” he said.
“The study has also suggested that value addition in agriculture should be encouraged by increasing awareness among the farming community regarding the importance of value addition and the adoption of modern farming technology and methods,” he said and concluded that at the same time, providing financial incentives to small landholders to encourage investment in modern agricultural equipment and better farming methods was also imperative.
