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Economic strategy & growth of pakistan 2011 12


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Pakistan faces many challenges at the beginning of the second decade of the 21stcentury:

• Decades-long struggle with macroeconomic stabilisation arising from unsustainable fiscal policies
• Pressure of demography
• Legacy of economic distortions
• Battering from external events, including earthquakes, floods and a continuing
longstanding low intensity conflict
• A large and loss-making public sector that impedes market development
• Low and declining productivity
• Heightened expectations of the population for a better life from a democratic

Our growth experience of the last four decades has been volatile annual growth and
declining trend in long run growth patterns. In addition, productivity growth (a
measure of efficiency) has been low in comparison to our comparators. For the last
four years per-capita incomes have not increased in real terms while double-digit
inflation has prevailed.

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Economic strategy & growth of pakistan 2011 12

  1. 1. Economic Strategy &Growth of Pakistan
  2. 2. Group MembersTariq Soomro (MBE-12-34)Hina Ashraf (MB-10-936)Maria Naz (MBE-12-55)Arif Awan (MBE-12-37)Sajid Iqbal (MBE-12-44)Naveed Khaleel (MBE-12-46)
  3. 3. IntroductionTariq SoomroMBE-12-34
  4. 4. ECONOMY OF PAKISTAN27th LargestIn The World(PPP)44th LargestTerms OfNominal GDPSemi-industrializedEconomyGDPAgriculture:20.1%Industry:25.5%Services:54.4%PeoplesAgric: 45.1%Indy: 20.7%Ser: 34.2%Source: CIA The World Fact Book
  5. 5. History Of Pakistan Strategy•Short term Strategy•Political Instability•Change in Govt.•New Short TermPlanning•Wars and Floods•Corruption inDevelopmentProjects•Based on ForeignLoan or Aid
  6. 6. Goals and Objectives•Goal Is To Maximize Opportunity ForAll Citizens•Pakistans Population Growing At 3 PerCent Annually• GDP Needs To Grow At A Rate OfAround 7 To 8 Per Cent Annually•This Is The Policy Goal!
  7. 7. Monetary PolicyFiscal Policy/YearBudgetMain Focus
  8. 8. DefinitionsMonetary policy relates to the supply of money, which iscontrolled via factors such as Interest rates and reserve requirementsfor banks. For example, to control high inflation, policy-makers(usually an independent central bank) can raise interest rates therebyreducing money supply.Fiscal policy is the use of government expenditure and revenuecollection to influence the economy.A budget is a quantitative expression of a plan for a defined periodof time. It may include planned sales volumes and revenues, resourcequantities, costs and expenses, assets, liabilities and cash flows. Itexpresses strategic plans, activities or events in measurable terms
  9. 9. Agriculture, Manufacturing & FiscalDevelopmentHina AshrafMB-10-936
  10. 10. Agriculture Reforms• Provide Electricity Tube well• WWF and NRSP Program for Farmers• Fix Highest Rate of Wheat and Cotton• Green Tractor Scheme• Subsidy for loanAgriculture Reforms
  11. 11. AgricultureGrowth• Growth This Year Stood At 3.1 Percent As Compared To2.4 Percent During 2010-11.-Cottonproduction• Increased To 13,595 Thousand Bales In 2011-12 From11,460 Thousand Bales In 2010-11 Showing An IncreaseOf 18.6 Percent.Wheatproduction• decreased to 23,517 thousand tons in 2011-12 from 25,214thousand tons in 2010-11 showing a decrease of 6.7percentSugarcaneproduction• increased by 4.9 percent to 58.0 million tons in 2011-12from 55.3 million tons last year.
  12. 12. ManufacturingDuring the first nine months of the currentfiscal year 2011-12, large scale manufacturingLSM) (posted a growth of 1.05 percent ascompared to growth of 0.98 percent during thesame period last year.Pharmaceutical (10.9%), Paper and Board(8.4%), Wood Product (7.4 %), Food Beveragesand Tobacco (6.5 %), Non-metallic mineralProducts (2.9 %), Leather Product (1.8 %) andTextile (0.8 %).Generating Sets (143.9 %), Blankets (109.9%), ElectricTransformer (31.2%), Heavy Machinery & equipments(21.0%), Sugarcane Machine (19.2%), Sugar (15.3 %),Liquids/Syrups (14.1%), Tea blended (13.3%), Tablets(10.7 %), Jeeps & Cars (8.8%), Footwear (6.2%), LPG(3.4 %), Cement (2.9 %) and Sugar (15.3 ).
  13. 13. Money & Inflation SectorsMaria NazMBE-12-55
  14. 14. Fiscal DevelopmentFiscal deficit isrecorded at 5.0% during JulyMarch2011-12as compared to5.5% last year.Totalexpenditure ofRs. 3721.2billion wasestimated for thefull year.Total revenuesreached to Rs1747.0 billionduring July-March, 2011-12against Rs1495.3 billion inthe same periodof last year.
  15. 15. Money And CreditSBP lowered the discount rate by cumulative 200 bpspoints to 12 percent during first half of fiscal year 2011-12, toassist in boosting the private sector credit and investment.Government borrowing from the banking system forbudgetary support and commodity operations stood atRs1,003.3 billion during July-11thMay, 2011-12 ascompared to Rs. 506.5 billion in the comparable period ofthe last year.Government has borrowed Rs.442.3 billion from the StateBank of Pakistan, while Rs 642.1 billion borrowed from thescheduled banks.
  16. 16. Capital Markets• The government conducted seven auctions ofPakistan Investment Bonds (PIBs) during 2011-12(Jul-Mar) raising Rs. 159.246 billion.• The SECP has recently approved notification ofthe Debt Securities Trustee Regulations (DSTRegulations)• The Pakistani Stock markets performed wellduring the current fiscal year as compared with theother world indices.
  17. 17. Inflation The inflation rate as measured by the changes inConsumer Price Index (CPI) stood at 10.8 percentduring (July-April) during current fiscal year 2011-12, against 13.8 percent in the comparable period oflast year. Core inflation is estimated at 10.4 percent duringJuly-April 2011-12.
  18. 18. Trade & EducationArif AliMBE-12-37
  19. 19. Balance of Trade & PaymentIn absolute terms, exports have increased from $20460million in July-April 2010-11 to $ 20474 million in theperiod thereby witnessing a growth of 0.1 percent during thefirst ten months (July-April) of the fiscal year 2011-12.Imports during the first ten months (July-April) of thefiscal year 2011-12 increased by 14.5 percent compared withthe same period of last year, reaching to $33.15 billion.Foreign Exchange Reserves stood at $ 16.5 billion at theend of April, 2012. Of which, reserves held with theStateBank stood at $ 12.04 billion and by banks $ 4.45billion.
  20. 20. External And Domestic DebtDuring first nine months of current fiscal year(2011-12), total public debt registered anincrease of Rs.1,315 billion and stood atRs.12,024 billion.Public debt as a percent of GDP stood at 58.2percent by end-March 2012 as compared to55.5 percent of GDP during the same periodlast year.Pakistan External Debt and Liabilities (EDL)stock was recorded at $60.3 billion as ofMarch 2012.
  21. 21. Education Reforms in Economy• Free Books and Uniform• Compulsory Education• Maar Nhi Pyar• Registered Madrasa’s• Adult Education• Technical Education• Foreign ScholarshipsEducation Reforms
  22. 22. EducationLiteracy rate for the population (10 years and above) is 58percent during 2010-11, as compared to 57 percent in 2008-09 (by PSLM).Province wise data suggest that Punjab leads with 60 percentliteracy followed by Sindh with 59 percent, KhyberPakhtunkhwa with 50 percent and Balochistan with 41percent.A total of 134,118 youth received vocational and technicaltraining under the President’s Funni Maharat Programme andPrime Minister’s Hunermand Pakistan Programme.During the period 2008-12 a number of 3996 scholarshipswere awarded under different programmes,3572 scholarsproceeded to avail these programmes on merit basis and anumber of 1650 scholars completed their studies.
  23. 23. Health, Population &TransportSajid IqbalMBE-12-44
  24. 24. Health And Nutrition At present, there are 972 hospitals, 4,842 dispensaries,5,374 basic health units and 909 maternity and childhealth centres in Pakistan. the population and health facilities ratio worked out 1,206persons per doctors, 16,426 persons per dentist and 1,665persons per hospital bed. The total outlay of health sector is budgeted Rs.55.1billion which included Rs.26.2 billion for developmentand Rs. 28.9 billion for current expenditure which isequivalent to 0.27 percent of GDP during 2011-12 ascompared to 0.23 percent in 2010-11.
  25. 25. Population, Labor Force & EmploymentPopulation of Pakistan is estimated 180.71 million duringthe year 2011-12. Population Growth Rate is 2.03 percentin 2011-12 while it was 2.05 percent in 2010-11Urban population has increased to 67.55 million from 65.3million in 2010-11 while rural population has increased to113.16 million from 111.82 million in 2010-11The total labor force has increased from 56.33 million in2009-10 to 57.24 million in 2010-11.Total unemployment rate has increased from 5.6 percent in2009-10 to 6.0 percent in 2010-11.
  26. 26. Transport And Communication The roads in Pakistan carry over 96 percent of inland freight and 92percent of passenger traffic and undoubtedly the backbone ofPakistan’s economy. Pakistan’s current road network is about 260,000 km which catersservices to eleven million vehicles of all type. NHA has completed 12 projects of flyovers, bridges, interchangesand road up gradation during the last one year at a cost of Rs 19.6billion. Heavy rains and floods severely damaged the Transport andCommunication system during last two years. Pakistan International Airlines Corporation earned increasedrevenue amounting to Rs. 116.02 billion in year 2011 as comparedto 107.0 billion last year Revenues of the telecom sector during the 2011-12, standing at Rs.363 billion compared to the last year 344.2 billion show an increaseof 5.4 percent.
  27. 27. EnergyPrimary energy supply during current year is 64.52million TOE compared to 63.09 million TOE lastyear thus showing an increase of 2.3 percent.The average crude oil production during July-March2011-12 remained 66032 barrels per day showing anincrease of 0.05 percent.Natural gas in the form of CNG posted a positivegrowth 10.8 percent during July-March 2011-12.The household sector consumed 44 percent of thetotal electricity generated followed by industrial (26percent), government (12.3 percent), agriculture (10.4percent) and commercial (6.8 percent) during July-March 2011-12.
  28. 28. Budget 2011-12
  29. 29. Bad Impact & ConclusionNaveed KhaleelMBE-12-46
  30. 30. Bad Impact on Economy 2003-08• Suicide Bombing• Drone Attacks• Fear of Investing• Low Business level• Stop Development Projects• Stop Funding by IMF &World Bank
  31. 31. Inadequate MarketDevelopment• Lack of competition• Tax tariff and policy• distortions• Entry barriers• Government• involvement• Poor regulationLack of Efficient PublicSector Management• Provide core governancegoods such as security of life,property, transaction andcontract• Facilitate markets andinvestment with informedpolicy and competentregulation• Promote deepening ofphysical, human and socialinfrastructuresConstraints to Economic Growth ofPakistan
  32. 32. •Competitive Market•Productive Human Resource•Healthy Population•Meaningful Education•Connecting Market And People•Knowledge Creation And Commercialization•Diffusion And Absorption• Development Of ClusterReforms For Productivity
  33. 33. If all the Oil reserves of Saudi Arabia & Iran were put together,These are approximately 375 Billion Barrels, But A single TharCoal Reserve Of Sindh is about 850 Trillion Cubic Feet, which ismore than combined Oil Reserves Of Saudi Arabia & Iran.Just 2% usage of Thar Coal Can Produce 20,000 Mega Watts ofElectricity for next 40 Years without any single second of LoadShedding.We have Best and largest Canal System in the worldPakistan has 1,339.25 tonnes of gold reserves situated inBalochistan with 63.50 tonnes at Saindak and 1275.75 tonnes atReko Diq, sources told Daily Times.Think About it!