Pak economy to grow by 3% in current fiscal despite ravages of COVID-19, says central bank chief

Sajjad Hussain
·2-min read

Islamabad, Apr 12 (PTI) Pakistan's central bank chief on Monday said the country's economy would grow by 3 per cent in the current fiscal year despite the ravages of COVID-19.

Addressing an event at the Pakistan Stock Exchange (PSX) in Karachi, State Bank of Pakistan (SBP) Governor Dr Reza Baqir said though the country is battling a surge in coronavirus cases, the good sign is that it is entering the third COVID-19 pandemic wave with improved economic indicators as compared to the first wave last year.

'It is a good sign and we hope that we will tackle the third wave successfully,' he said.

Pakistan's economy would grow by 3 per cent in the current fiscal year, Baqir said.

However, his statement is at variance with the estimates of global financial bodies. While the International Monetary Fund (IMF) has projected Pakistan’s GDP growth at 1.5 per cent, the World Bank said it would be 1.3 per cent in the ongoing fiscal ending June 30.

Exuding confidence, Baqir said Pakistan's economy was performing well. One of the indicators, he said, was the growth in remittances which was above USD 2 billion for the 10th consecutive month in March.

The SBP chief underlined that the large scale manufacturing sector posted a growth of 9 per cent in January as compared to negative growth of 5.7 per cent in the same month last year. Also, the sales of cars, cement, steel and fast moving consumers goods remained robust.

“The fiscal and monetary policies coupled with stimulus are expected to help the economy grow this year compared to a contraction witnessed during the previous fiscal year,” he said, adding that the SBP injected liquidity equal to 5 per cent to the GDP in the system through the monetary policy measures, which helped to revitalise the economy and create jobs for the people.

Baqir also offered to provide support to the PSX. “Central bank is working on regulations to develop the secondary debt market at the Pakistan Stock Exchange,” he said.

If Baqir's estimate of 3 per cent growth proves right, it will be a remarkable improvement for debt-ridden Pakistan, which registered a negative growth last year. PTI SH SCY SCY