The economic growth rate has improved, inflation will be reduced, claims the Ministry of Finance
According to the report, economic growth will be moderate this year and will be better next year (Photo: File).
Islamabad: The Ministry of Finance, while claiming that the economic growth rate has improved and the inflation rate has decreased, has described the external debt and heavy interest payment as a major challenge for the financial situation.
According to the ongoing monthly economic update outlook report on the country’s economy, inflation is between 18.5% and 19.5% this month, while inflation is expected to further decrease to 17.5% in May 2024. The growth rate in the first and second quarter was 2.5 percent and 1 percent respectively.
According to the Ministry of Finance, the financial deficit has reached 3224 billion rupees with an increase of 34.8% in 8 months. Financial discipline must be ensured for sustainable economic development. The report said that the economic growth will be moderate this year and better next year. In the first 9 months of the financial year, the financial and external sectors have improved.
The agriculture sector improved by 5 to 8.6 percent in the first half of the fiscal year, but the performance of major industries remained unsatisfactory compared to the target. According to the report, the tax revenue in 8 months increased by 30% to 6 thousand 711 billion rupees. Non-tax revenue doubled to Rs 2267 billion.
In 9 months, exports were recorded at 23 billion dollars with an increase of 9.3%. Remittances increased by 0.9% to $21 billion while imports decreased by 8% to $38.8 billion during the period.
Current account deficit decreased by 87.5% to $500 million surplus. Direct investment decreased by 9.7% to 1 billion 90 million dollars. The foreign exchange reserves have exceeded 8 billion dollars, the exchange rate has exceeded 278 rupees.
According to the Ministry of Finance, there was a reduction in development expenditure and an improvement in the primary surplus. Agricultural loans increased by 33.6% and the volume was recorded at 1434 billion rupees. Credit to the private sector fell by 54 percent and only Rs 88.6 billion was disbursed. The report welcomed the IMF’s second economic review and approval of the final tranche of $1.1 billion, while the stock market rally was a sign of renewed investor confidence.
The economic growth rate has improved, inflation will be reduced, claims the Ministry of Finance