According to newspaper reports, two international lending agencies, the World Bank and the International Monetary Fund, have projected mixed and probably confusing forecast about the economy of Pakistan. The country’s economy has recently suddenly lost its tempo, hindering not only its industrial growth, but also business, trade and investment. The lending agencies hope the rate of the country’s gross domestic product will gradually increase to five percent by the end of the current fiscal year. The growth rate recorded last year remained 4.7 percent which was expected up to five percent. However, keeping in view the present state of the national economy, it is unpredictable to attain five percent growth at the end of the current fiscal year. According to the fund managers, the country’s rate of inflation will jump to 5.2 percent at the end of the current fiscal year from 2.9 percent last year. The current account deficit has reached 1.5 percent of the gross domestic product according to the fund and 1.7 percent in the World Bank projection. This is expected when there is no economic supreme council in the country and the decisions are taken either by the prime minister or the finance minister on the advice of the bureaucracy.
The law and order situation, persistent energy crisis and poor government attention to the business and economy has severely affected the country’s exports. The agriculture sector, which had once thelion share in the economy, has been ruined for the last few years due to imprudent government policies. Low cotton production during the last fiscal year has affected the textile exports despite the fact that Pakistan had signed preferential trade agreement with the European Union. However, the World Bank hopes the exports will gradually increase with the passage of time. Pakistan always remained resilient to the world economic challenges. It is unfortunate that the economy of Pakistan is still lagging behind the regional countries as Indian economy is expected to grow by 7.7 percent and Bangladeshi by 6.8 percent during the current fiscal year. Even the Myanmar and Vietnam, living years in isolation for years, are recording twice the growth rate than Pakistan. The total dependence of the Pakistani economy is now on the Chinese investment and it could not be compared with the private investment which the country lacks in the current situation. Pakistan will have to devise investment-friendly policies and open up its markets for the international trade.
The country is facing constant threat from India which has negative effects on the national economy. Unless the government keeps itself up-to-date to the world affairs, the country would not only be headed toward political isolation, but also economic solitude.
