ADB predicts 1.9pc growth for Pakistan’s economy this fiscal year

KARACHI: Predicting Pakistan’s growth rate to be 1.9 percent this fiscal year, the Asian Development Bank (ADB) in its report has anticipated a reduction in the wave of inflation in the next financial year, ARY News reported on Friday.

The Asian Development Bank’s annual Outlook Report for 2024 revealed that the inflation in Pakistan has surged to its highest level in the past five decades last year, meanwhile, the inflation has continues to rise this year due to the surge in energy prices as part of the IMF program.

In its annual report, the Asian Development Bank stated that political instability in Pakistan is a major challenge for economic recovery and reforms.

Meanwhile the inflation in Pakistan is expected to remain at a high level of 25 percent this fiscal year and it is likely to decrease significantly in the next fiscal year.

According to the report, Pakistan’s economy shrank due to political uncertainty and extensive flooding, adding that the growth of the construction sector has been affected by rising costs and rising taxes.

The report suggested that the actions are needed for financial inclusion of women in Pakistan, expressing optimism that the agricultural production and industrial sector are expected to improve in the current fiscal year.

The ADB report stated that, if the reforms are implemented, the economic recovery will start from this year and the inflation for Pakistanis is likely to decrease in the next financial year. Food prices are expected to stabilize. By which the rate of inflation will reach 15 percent.

The ADB report highlighted that if the proposed reforms are implemented, economic recovery could commence as early as this year, potentially leading to a decrease in inflation for Pakistanis in the upcoming financial year.

Additionally, it anticipates stabilization in food prices, which could contribute to bringing the inflation rate down to 15 percent.