- Exports projected at $26bn, workers’ remittances expected to reach $24bn in FY20
ISLAMABAD: The Gross Domestic Product (GDP) is expected to pick up and grow at four per cent during the upcoming fiscal year 2019-20, with a contribution of 3.5pc from agriculture, 2.3pc from industry and 4.8pc from services, according to the Annual Plan 2019-20 released by the government on Tuesday.
The growth targets are subject to risks of extreme weather fluctuations, interruptions in envisaged reforms and non-aligned monetary and fiscal policies. However, the targets are attainable with the revived agriculture sector, growth in the industrial sector, pick up in private sector credit and expected competition and spillover effects of projects under China Pakistan Economic Corridor (CPEC).
“In the backdrop of highest-ever macroeconomic imbalances and the resultant adjustment drive, the economic growth was anticipated to decelerate during the current fiscal year (2018-19),” the plan read. “The growth decelerated from 5.5pc in 2017-18 to 3.3pc in 2018-19.”
Two important commodity producing sectors, including agriculture and manufacturing, witnessed negative growth in the previous fiscal.
The annual plan targets workers’ remittances to reach the level of $24 billion during FY2019-20 while the current account deficit is projected to be contained at 3pc of GDP.
“On the fiscal, monitory and capital market development side, the government would initiate various reforms for fiscal consolidation during 2019-20,” it said, adding that the State Bank of Pakistan had started a tight monetary policy during FY18 and continued it during FY19.
The average inflation during 2019-20 is projected around 8.5pc while the capital market is expected to remain vibrant during 2019-20 as a result of the measures to be adopted by the Securities and Exchange Commission of Pakistan.
The exports are projected to reach $26.18 billion in 2019-20 from $24,656 million estimated for FY2018-19, whereas on account of higher growth trajectory, imports are expected to marginally increase by 0.8pc and reach the level of $53,664 million in 2019-20 from the estimated total of $53,248 million for 2018-19.
The Current Account Deficit (CAD) is projected to be contained at $8.31 billion (3pc of GDP) during 2019-20 as against the estimated deficit of $13,1 billion (4.7pc of GDP) by the end of the outgoing fiscal year.