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World Bank projects four pct growth for Pakistan

ISLAMABAD: The World Bank has forecast Pakistan's GDP growth rate for the current fiscal year at four percent, ARY News reported on Thursday. 

The bank in its report on South Asia says the economy of the country to be driven by less loadshedding, resilient remittance flows, manufacturing export performance and a dynamic service sector. 

South Asia Chief Economist Martin Rama, while sharing key findings of the World Bank's report "South Asia Economic Focus" in a video-conference media briefing, said Pakistan's economy though still weak had begun to show signs of improvement.

The government of Pakistan has been dealing with balance of payment and fiscal imbalances that have intensified in recent years, the report said. An economic slowdown, weak external inflows, low revenue collection and high subsidies to support an unsustainable energy mix have all contributed to a significantly deteriorating balance sheet. 

According to the report, three sources of risk appear worrisome: Pakistan imports more than it exports. An uncertain political environment undermines investor confidence and depresses economic activity.

Estimates for first half of fiscal year 2014 shows growth improved in wholesale and retail trade, finance, and insurance. Acceleration in growth of large-scale manufacturing came from a strong performance of agro-based industries, iron and steel, construction, and external demand-driven cotton yarn and fabrics-based textiles. 

Pakistan is on track to meet fiscal deficit target of 5.8 percent of GDP in fiscal year 2014. 

Higher financial inflows are expected to be attracted by lower country risk, privatisation's, new trade relations with neighbours and the opening of special economic zones and multilateral flows, the report added. 

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