Following a strong economic comeback in fiscal year (FY) 2021, Pakistan’s economic growth is likely to decrease to 4% in FY2022 as a result of stricter fiscal and monetary policies, before ramping up again in FY2023, according to a research released on Wednesday by the Asian Development Bank (ADB).
Pakistan’s GDP growth is expected to slow to 4% in FY2022 from 5.6 percent in FY2021, according to the Asian Development Outlook (ADO) 2022, the Asian Development Bank’s annual flagship economic publication, as the government implements measures to reduce the current account deficit, increase international reserves, and reduce inflation. Due to higher private consumption and investment, growth is predicted to rise to 4.5 percent in FY2023.
“Thanks to well-coordinated fiscal and monetary measures to the pandemic, Pakistan’s economy is steadily recovering,” stated ADB Country Director for Pakistan Yong Ye. “As a result, the industrial and service sectors grew dramatically.” To keep growing inflation and external imbalances under control, structural changes must be maintained alongside proper fiscal and monetary policies. Comprehensive tax policy and administration improvements are also needed for increasing revenues and funding key public services. “The Asian Development Bank is firmly dedicated to assisting Pakistan’s long-term development.”