ISLAMABAD-The World Bank has forecast that if the novel coronavirus (COVID-19) lasts longer than expected, Pakistan’s exports could plunge to negative growth of 19.7 percent in the current fiscal year (FY) 2019-20 as compared to the previous one.
The negative impact of global lockdown due to coronavirus would persist longer and could go beyond FY-20, said the World Bank in its twice-a-year-regional update ‘South Asia Economic Focus’ adding that under the baseline scenario, the growth rate of exports of Pakistan is likely to contract by 5.3 percent during the year 2020-21.
However, the World Bank has projected that the exports in 2021-22 would witness a positive growth of 7.3 percent. The imports of goods and services are also likely to be contracted by 26.3 percent during the year 2019-20 while in the subsequent years of FY-21 and FY-22, the imports would witness a negative growth of 7.7 percent and positive growth of 4.8 percent respectively.
Services growth during the current FY is projected to contract by 1.7 percent while in the year 2020-21 it would grow by 0.8 percent and in FY-22 the sector would grow by 3.4 percent.
Similarly, the report forecast that the country’s industrial sector would contract by 2.1 percent in the current FY while during FY 2020-21, the sector would grow by 0.7 percent and in 2021-22, it would grow by 3.7 percent.
The agriculture sector’s growth would remain positive despite the negative impact of the lockdown and it is likely that the sector would grow at the rate of 1.0 percent during current FY while in next two years its growth would gradually pick the pace to 1.7 percent in FY-21 and 2.3 percent in FY-22.
With respect to inflation, the report projected that by the end of current FY, the inflation rate would remain at 11.8 percent while in the next years the rate would be recorded at 9.5 percent and 6.0 percent by the end of FY-21 and FY-22 respectively.The debt to gross domestic products (GDP) ratio which is likely to remain at 90.6 percent during the current FY, would further rise in the next FY up to 91.8 percent, however, in the year 2021-22, the ratio is likely to come down to 89.6 percent, the report added.