It is good to note that the World Bank has duly acknowledged the error it had made in its recent report on the estimates of gross external financing need for Pakistan for the current financial year and rectified it as well.

According to the reports in the media, the error was pointed out to the World Bank high ups during discussions in Washington by Pakistan delegation headed by the Federal Finance Secretary.

Admitting the glaring mistake so made, the World Bank in order to set things right has stated that the error was made due to wrongfully deducing Pakistan’s external financing needs at 31 billion Dollars and accordingly it has revised the figures downward to around 17 billion Dollars. The difference of around 14 billion Dollars so made has been attributed to incorrectly adding foreign portfolio investment to determining Pakistan’s gross external financing.

Pakistan delegation had quite emphatically pointed out to the World Bank senior officials that as per international reporting standards, portfolio investment is not included while calculating the gross financing needs of a country.

Based on this standard, which is accepted by all international financial institutions, Pakistan’s gross financing need for 2017-18 is about 18 billion Dollars (5.3 per cent of Gross Domestic Product GDP) rather than 31 billion dollars (9 per cent of GDP) as was mentioned in the World Bank report which had created lot of confusion and controversy in the country.

Generally, improvement of the external balance hinges upon the revival of exports, slowdown in imports and stable remittances flows. Accordingly, this is what Pakistan has precisely achieved during first two months of current financial year i.e. exports and remittances have improved and imports have slowed down. All this is quite commendable indeed.

Pakistan delegation and World Bank deserve a pat on their backs, in all fairness.. All that ends well is good, indeed.

ASMAAR BILAL,

Lahore, October 18.