Finance Minister Muhammad Aurangzeb is presenting Pakistan’s economic survey for the fiscal year 2024 at a press conference in Islamabad.
The press conference has started with the recitation of the Holy Quran.
The Pakistan Economic Survey is an annual report that charts the country’s economic progress for the outgoing financial year, ie, from July 1, 2023 to June 30, 2024, and is one of the stages of the federal budget process that the public is exposed to.
The pre-budget report provides an overview of Pakistan’s economy and highlights its performance in various sectors, typically covering key indicators such as GDP growth, inflation, trade, and investment, as well as sector-specific performance in areas like agriculture, industry, and services.
The next stage (tomorrow) involves the finance minister presenting the budget for the next financial year to the National Assembly. In the ensuing weeks, lawmakers will debate on the bill’s provisions and the budget will be made into law before the fiscal year ends.
Pakistan is looking to secure a “longer and larger” bailout with the IMF, and it is likely that the lender’s conditions will factor heavily into the forthcoming budget.
Significant economic challenges
According to the Planning Commission’s estimations made in the Annual Plan Coordination Committee, the economy faced significant challenges at the beginning of 2023-24, primarily due to the lagged impacts of economic disruptions of the previous year.
However, the economy made a moderate recovery later in the year and grew by 2.4 per cent.
During the year 2023-24, the primary driver of growth was the agriculture sector, growing by 6.3pc, owing to bumper outputs of wheat, cotton and rice.
The industrial sector grew by 1.2pc mainly due to a slowdown in large-scale manufacturing activities. However, there was growth in mining and quarrying, small-scale manufacturing, and construction.
The services sector also registered 1.2pc growth as wholesale and retail trade experienced a mere 0.3pc growth. The transport, storage and communications sector also recorded a low growth of 1.2pc due to subdued demand.
Total revenue collection grew by 41pc during July-March 2023-24, outpacing the 36.6pc growth of total expenditure. Both tax and non-tax revenues grew by 29.3pc and 89.8pc, respectively. Markup expenditure constituted 40pc of the total expenditure.
During July-April 2023-24, average inflation was recorded at 26pc as compared to 28.2pc in the same period of last year.
A continuously declining inflationary trend has been observed since January 2024.
More to follow