ISLAMABAD - Like that of the previous government of Pakistan Peoples Party (PPP), the PML-N government also failed to achieve major economic targets set for the outgoing financial year 2013-2014 including those pertaining to GDP growth, agriculture sector and inflation rate.
Launching the ‘Economic Survey 2013-2014’, Finance Minister Senator Ishaq Dar on Monday admitted that government failed to achieve the GDP growth target of 4.4 percent during outgoing fiscal year, as it grew by 4.14 percent. Similarly, the incumbent government has also missed some other major targets.
Despite that Ishaq Dar presented a rosy picture of the economy while briefing the media on economic performance of government. He said that country’s GDP growth rate has exceeded the figure of four percent, which happened for the first time in last six years. He vowed to increase country’s growth to seven percent by 2017. Dar said all economic indicators performed well as compared to previous year.
The government missed the growth target of agriculture sector, as it recorded growth of only 2.12 percent during outgoing financial year against the target of 3.8 percent. However, the minister blamed the lesser production of cotton and pulses responsible for it. Production of wheat, rice, sugarcane and maize has enhanced during outgoing fiscal year over last year, he added.
The Economic Survey 2013-2014 showed that government has also missed the inflation target of eight percent, as it remained at 8.69 percent during outgoing financial year. However, Ishaq Dar was of the view that government has controlled the inflation rate, as he said international financial institutions projected it at 12 percent. Similarly, the services sector recorded 4.29 percent growth during outgoing financial year against the government’s estimates of 4.6 percent.
Per capita in dollar terms has reached to $1,386 in 2013-2014 from $1,339 of 2012-2013. On a question, the finance minister said that half of the population of the country lives below the poverty line (earning less than $2 per day). The government has also missed its target for the investment-to-GDP ratio. Against a target of 15.1 per cent, the ratio actually stood at 14 per cent this year, below even the 14.6 per cent ratio achieved in FY2012-13. National savings were expected to grow by 14 per cent during the current fiscal year but ended up at 12.9 per cent, lower than last year’s 13.5 per cent national savings-to-GDP ratio.
On the positive side of the things, the electricity generation and gas distribution has witnessed growth of 3.72 percent during outgoing financial year, which was negative 16.33 percent in previous year. Similarly, government successfully achieved the industrial sector growth target. The finance minister said that industrial sector performed well due to better gas and electricity supply to industries this year. He added that large-scale manufacturing has recorded growth of 5.31 percent during outgoing fiscal year against 0.48 percent growth of last year.
Dar was optimistic that government would restrict the budget deficit at below 6 percent of the GDP by the end of June 2014. Budget deficit remained at 3.2 percent of the GDP, which was 4.7 percent last year. Revenue collection of the federal board of revenue was recorded at Rs1,744.8 billion during 9 months (July-March), which is 15. 9 percent higher than the collection of previous year, he added.
Talking about trade, the finance minister informed that exports were recorded at $21.4 billion during 10 months (July-April) of the outgoing fiscal against $20.1 billion of the corresponding period of previous year, showing an increase of 4.24 percent. Similarly, the imports recorded growth of 1.2 percent, as country’s imports bill stood at $37.1 billion during July-April 2013-2014 against $36.7 billion of the previous year. The current account deficit was recorded $2.162 billion (July-April 2013-2014) against $1.574 billion of previous year. Remittances stood at $12.9 billion against $11.6 billion of previous year.
Ishaq Dar further informed that total foreign investment has reached to $2.979 billion during July-April of 2013-2014 as against $1.277 billion of the corresponding period of previous year. The government has included two billion dollars generated from Eurobonds in total foreign investment. Total investment registered was at Rs3,554 billion during outgoing fiscal year, which was 3,276 billion last year. Public investment recorded at Rs877 billion in outgoing fiscal year that was Rs748 billion last year.
The country’s foreign exchange reserves were recorded at $13.63 billion on May 21, 2014 as compared to $11.4 billion of the corresponding period of last year. Country’s exchange rate remained stable at 98.77 percent during ongoing fiscal year. To a query, Ishaq Dar said government would meet the requirement of the defence sector.