Pakistan’s economy expanded by 2.09% in the third quarter of the financial year 2023-2024, bolstered by significant growth in the agricultural sector.
Pakistan’s economy expanded by 2.09% in the third quarter of the financial year 2023-2024, bolstered by significant growth in the agricultural sector, according to a press release from the Pakistan Bureau of Statistics (PBS) on Tuesday. This growth comes after a period of economic contraction and highlights a positive shift in the country’s economic trajectory.
The PBS also projected a provisional GDP growth rate of 2.38% for the entire financial year ending in June 2024. This forecast marks a notable recovery from the previous year, 2023, which saw a revised GDP contraction of 0.21%. The economic downturn last year was attributed to political instability, increased taxes and gas tariffs, restricted imports, and a sharp depreciation of the rupee, all of which spurred a rapid rise in inflation.
In a recent half-year report, Pakistan’s central bank anticipated real GDP growth to fall between 2% and 3% for the fiscal year 2024. This projection aligns closely with the figures released by the PBS, indicating a cautiously optimistic outlook for the country’s economic performance.
The PBS has only recently started releasing quarterly growth figures, beginning in November as part of the structural benchmarks required under a $3 billion bailout program agreed upon with the International Monetary Fund (IMF). This move towards more frequent reporting aims to enhance transparency and align with international financial reporting standards.
Revised estimates for the first and second quarters of FY 2023-2024 indicate GDP growth rates of 2.71% and 1.79%, respectively, up from initial estimates of 2.5% and 1%. These revisions underscore a stronger-than-expected performance in the early part of the fiscal year.
Agriculture has been a major driver of this economic growth, with the sector showing a provisional growth rate of 6.25% for FY 2023-2024. The PBS attributed this robust performance to double-digit growth in key crops, particularly wheat, cotton, and rice. The bumper harvests of these essential crops have significantly contributed to the positive economic outcomes.
The industrial and services sectors also showed modest growth, each estimated at 1.21% for the financial year. While these figures are not as high as those for agriculture, they still represent a stable contribution to the overall economic expansion.
The positive performance in agriculture is crucial for Pakistan, where the sector plays a significant role in the economy, providing employment and contributing to both GDP and export revenues. The improved agricultural output not only boosts economic growth but also helps in stabilizing food prices, which is critical in a country facing inflationary pressures.
In summary, Pakistan’s economy has shown a resilient recovery in the third quarter of FY 2023-2024, with agriculture leading the way. The projected annual growth rate of 2.38% suggests a cautious optimism for the country’s economic future, supported by strategic policy measures and improved sectoral performances. As the country continues to navigate economic challenges, these positive trends provide a hopeful outlook for sustained growth and stability.