Islamabad November 28 2023: GDP growth rate of 2.13% has been estimated for Q1 2023-24 as compared to Q1 2022-23, as per National Accounts Committee of Pakistan.
Agriculture has shown a growth of 5.06%, industry 2.48% and services 0.82%.
The GDP estimates have been released to meet IMF structural benchmark under tight deadline and are based on available information and data. However, as a matter of practice and due to the time-lag involved in the finalization of data for the last two fiscal years, the annual GDP estimates are subject to revision in the NAC meeting to be held in May 2024.
In agriculture, crops are posting healthy growth of 6.13% including 11.16% growth in important crops. The major driver for growth in important crops is the increase in sowing area in comparison with the last year. For instance, the sowing area for rice, cotton and maize increased by 21%, 11%, and 5%, repsectively. It declined by 11% for sugarcane which is offset by the other three major crops.
Industry, after witnessing a continuous decline in three quarters in 2022-23 except a modest growth in Q2, has changed its direction in Q1 2023-24 by posting a growth of 2.48%. Mining and quarrying industry is showing positive growth of 2.15% on the basis of quarterly production of mining sector. LSM growth is on the basis of Quantum Index of manufacturing (QIM) which showed a growth of 0.93% in Q1 2023-24. A growth of 0.08% has been reported in Electricity generation and distribution, gas distribution and water supply. Construction industry growth has been estimated at 1.73% on the basis of output of construction indicators.
Production of cement has increased by 15.38% during Q1 of 2023-24 as compared to the same quarter last year. Similarly increase in other indicators has also been witnessed. Iron & steel observed negative growth of 2.20% during Q1 2023-24 however its impact has been offset by other indicators.
During Q1 2023-24, the overall growth in services is 0.82%. Wholesale and Retail Trade, which is based on output of agriculture, manufacturing and imports has been estimated at 3.05% because of positive growth in agriculture and industry. Transport is showing a growth of 1.7% which is based on the quarterly data reported by the sources. Information & Communication, which remained negative in most of the quarters last year has changed its direction by posting 2.4% growth mainly because of low base and quarterly information received from the sources. Finance and Insurance industry has a growth of -12.79% because of decline in output of insurance companies, exchange brokers, mercantile brokers and also high growth in deflator. Public administration (which is based on the budget documents of federal, provincial, district and cantonments/local government) has reported -16.65% growth in Q1 2023-24. Further, high deflator also resulted in decline in constant prices. Negative growth in both education and human health & social work activities are mostly driven by the decline in government budget data along with high deflator.
GDP Growth For Fiscal Year 2022-23 Revised Downward To Negative
The revised growth rate of GDP for the year 2022-23 is estimated at -0.17%, which was provisionally estimated at 0.29%. In the revised estimates, agriculture has significantly improved from 1.55% to 2.25%. Despite reduction in the production of sugarcane (from 91.1 to 88.0 M.Tons), important crops have been revised upward from -3.20% to 0.42% due to increase in production of wheat (from 27.6 to 28.2 M.Tons) and maize (from 10.2 to 11.0 M.Tons). The other crops have declined from 0.23% to -0.93% due to a decline in production of green fodder (from 192.2 to 190.0 M.Tons), fruits (-5.6%) and oilseeds (-9.7%). Forestry has improved in revised estimates from 3.93% to 14.2% due to higher production reported by Punjab province.
Despite improvement in electricity, gas and water supply (from 6.03% to 9.84%), the industrial sector growth has declined from -2.94% to -3.76% in the revised estimates due to decrease in LSM (from -7.98% to -9.87%) and construction (from -5.53% to -9.16%).
The services sector growth has also declined from 0.86% to 0.07% due to transportation and storage (from 4.73% to 3.27%), information & communication (from 6.93% to -2.55%), finance & insurance (from -3.82% to -8.09%), public administration and social security (from -7.76% to -8.99%), and education (from 10.44% to 9.94%). In the revised estimates, wholesale and retail trade slightly improved from -4.46% to -4.01% whereas human health and social work improved from 8.49% to
10.57%.
