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0.3% economic growth rate debunked

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The size of Pakistan’s economy has shrunk to $341.5 billion and its per capita income has slipped to just $1,568 in the outgoing fiscal year due to almost flat economic growth and currency devaluation. Against this backdrop, a dispute has arisen about the official GDP growth figure.
The economy shrank by $34 billion or 9% whereas per capita income also decreased by $198 or 11.2%, according to the provisional estimates that the National Accounts Committee (NAC) approved a day earlier.
But according to some government sources and fresh details, the management of the Pakistan Bureau of Statistics (PBS) faced immense pressure to change the economic growth rate which was initially estimated at a negative 0.5% for the outgoing fiscal year, ending on June 30.
The sources said that the PBS management succumbed to the pressure and agreed to show a nominally positive growth rate of 0.3%. Subsequently NAC stamped the figure.
In the Post-Disaster Needs Assessment (PDNA) report on the 2022 floods, the government had told the world that “around one million livestock are estimated to have perished”.
But the PBS counted that only around 200,000 animals had perished during the last summer floods, calling into question the credibility of both the government and the PBS.
The NAC approved that the livestock grew 3.8%, a number that surprised many as the rate of growth was even higher than 2.3% during the pre-flood period. The glaring contradiction has also put a question mark over the credibility of the official economic growth rate of 0.29%, which the NAC approved on Wednesday.
The change from a negative to a positive growth rate was apparently made in haste and the PBS — the country’s national data collecting agency — for the first time could not even present a proper “working paper” for the approval of the NAC, said the sources.
The NAC approved the provisional economic growth rate on the basis of mere one presentation and that, too, without having the working paper on the table.
Despite this, the size of the economy and the per capita income shrank in dollar terms during the outgoing fiscal year. The economy’s size slipped to $341.5 billion, 9% or $33.9 billion less than last year.
In rupee terms, the size of the economy reached nearly Rs85 trillion in 2022-23 — about Rs18 trillion higher than the last fiscal year — thanks to a record inflation rate in the country.

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