Economy swells to $160bn: Salman



ISLAMABAD: Pakistan is among the fastest growing economies in the world as its economy has reached the size of $160 billion from a mere $70 billion a few years earlier, Federal Advisor on Finance Dr Salman Shah said on Tuesday.

Talking to PTV, he said a national consensus should be evolved for not disturbing vibrant policies of any past government in a bid to ensure the country’s development.

ìEvery political party should pledge that good policies of past governments will not be discontinued,î he said.

Pakistan attracted a record investment of $6 billion last year. The volume of economy is increasing. According to a labour survey, five million new jobs were created last year, while investment to GDP ratio was 23.5 percent.

The economy, he said, has come out of the Selective Default (SD) in 1999 to B-1. The target is to improve the ratings further up to AAA and take the debt to GDP ratio to 20 per cent.

It was 100 in 1999. Now it is at 50 percent. The share of the income of middle class from total income of the country has increased to 56 percent, up from 46 percent recorded in recent years, he said.

While the share of bottom 20 percent population has increased from 5 to 12.5 percent, indicating that income is flowing towards middle and lower class as compared to upper class. From 1999 to 2007 only agriculture production remained 10 times high. A bumper wheat crop of 23.5 million tonnes was harvested this year.

He said the leading investment bank Goldsman Sach has reckoned Pakistan one of the largest economies of the world in the coming years. The country has the fourth largest workforce in the world. Pensions and salaries would be increased in the coming budget more than the ratio of inflation. Subsidy would be offered on food items and oil.

He said currently inflation ratio is around 7.5 percent and the salaries would be enhanced more than that. Old pensioners would be provided comparatively more increase.

Employment schemes would be announced in the budget with subsidies on mark-up. Small development schemes would be encouraged in villages aiming to make them self-sufficient. ‘Aik Hunar Aik Nagar’ programme would be initiated in far-flung areas to develop handicrafts, food processing, and home-made industries, he said.

The FATA Development Authority has been established to expedite development in backward areas. All basic amenities would be provided to the countryís far-flung areas.

The network of First Women Bank would be expanded aiming to provide adequate opportunities to women entrepreneurs. The concept of a Reconstruction Opportunity Zone (ROZES) is being developed for allowing duty-free export of their products to the USA.

http://www.thenews.com.pk/daily_detail.asp?id=59245

great news. might move back to pakistan soon

I feel that the day we start moving from agriculture based products export to technology based products e.g.automotives and parts, engineering machinery, software and IT services and we touch and exceed the 20 billion dollars mark. Then there will be appreciation of techies and poeple might stop relocating to Pakistan. After all wht is the point on total migration if you can reap economic benefits while sitting back home. My idea is that Pakistani companies should keep marketing offices in West/US and keep the production back in Pakistan, and major investments in manpower capacity and skills building.

This is good news.

However I will dispute one statistic. The $6 billion figure of foreign investment is due mostly to selling of state-enterprises. That is very different from the investment that is going on in China and East Asia where foreign investors are buying local companies and building local offices and factories.

However the rest is heartening news and inshallah this economic expansion should continue.

Ofcourse its going to be different. China and East Asia are in different leagues all together right now. Pakistan was suffering because almost everything worth anything was nationalized by Bhutto. Its obvious things are going to be denationalized.

no, actually it is not. this year it is not atleast. most of the privatization proceeds last year came from PTCL. however, that was fully paid for in the last fiscal year. the government has not conducted any major privatization projects this fiscal year. there were few small ones. but nothing that could have brought the figure to $6 billion. there is massive investment in real estate, gas, telecommunications, and banking. the industrial sector though is not getting enough. it has picked up, but i think the government is aware that there must be industrial investment for the economy to really move along. lets hope that happens this year forward.

The economic survey will be released today on 8th June,2007. The survey is based on the data collected till April, normally the GDP growth and rest of the data is revised even when the fiscal year ends. According to govt the real GDP growth in 2004-05 was 9 pct from original estimation of 8.4 pc which was revised to 8.6pct. So let's see where this data leads to.

The economy was 100 billion last year. How did it climb to 160 so soon? Mushy aur Shaukat sub ko chutiya bunaa rahein hain.

Can you show us the link/source from last year.

economy was $130 billion last year...that would make it $139 billion this year with 7% growth.

Economy last year was 135 billion and this year its 146.3 billion.

any problem?

so the headline is incorrect then? where are they getting the extra $14 billion from?

Could be the difference between nominal and real.

Yes its incorrect. Right now nominal GDP is $146.3 billion reported by PM.

I was putting official figures and not guessing.

Here is the latest data from IMF till year 2008:

http://www.imf.org/external/pubs/ft/weo/20...mp;grp=0&a=

shyt! Look at that GDP go baby

(billion US $)
2004 98.094
2005 110.970
2006 128.996
2007 141.378
2008 154.677

4 years, 150% increase in GDP.
Another 4 years, 150% more increase would be huge..225 billion from 60 billion a decade before!

Budget deficit remains to be the only thorn in our backside.

It is ok as long as we can finance this Deficit... we have recieved.. 6bln USD inverst and 5 bln USD remitences from outside...in total 11bln USD... so.. there is no point of concern at this time

Food for thought. Something ive always found hard to believe.....

http://www.youtube.com/watch?v=23Ioo9Pt27g

Sothere is no real INDUSTRIAL growth, or atleast substantial considering the amount of money that was heading our way.

150 % progress in five years, its miraculous. Why shouldn't the leaders of such a miraculous growth i.e. General Parvez Musharraf be made the President of US so that US will grow by 150 % in 5 years and whole world will be benefitted by additional US $ 17 trillion ( 150 % of present US economy) of growth in world economy .

you made an account just for this?
btw these numbers arent fudged, this is the Real GDP. which is the true indicator of economy size, not current gdp(in which inflation can take a huge part)

What it does show is that Pakistan was capable of growing this much before..but previous civilian governments concentrated more on looting the economy than making it grow.

And industrial growth over the last 7 years has been huge.

one example

http://pakistantimes.net/2004/07/30/business4.htm

No offence!!!
Just trying to find clarification.
Each year listed in the above stats show more than 10% growth. But I don't know that Pakistani economy grew at that rate. Lets say if Pakistani ruppee appreciated drastically every year during that period I can understand the figure.

I have just calculated that if Pakistani economy continue to rise at the same pace as stated above , it will be atleast double the chinese economy by 2050, just to add that chinese economy is projected to be the largest by that time by Goldman Sachs.

I cant understand who is making foll of every body, Goldman Sachs or General Parvez Musharraf.

damn you are stupid. You obivusly do not know #### all about economics, you think that the eocnomy wil conintnue to rise at this level? Economies start to level off when they reach an equilibirum. For example alot of the Western European countries during the industrial revolution experienced high economic growth rates (7%-14% etc), but now there economies are only growing around a percentage or two each year.

These figures are estimates by IMF. Official GDP is $146.3 billions.

You freakin kidding me?

Again IMF reports what GOP reports to them.

How many time does it have to be explained to idiots and some unknowlegable ppl that there is no magic stick involved in pushing our GDP up that far. It has been discussed to death and I will point it out again.. Two main things have happend

1. Sector inclusion. There were many sectors in pakistan which were never included in GDP calculation and thus our GDP really didnt project the true state of our economy. Now what happend over las few years is due to hard work of certain individuals within government many sectors have been brought into calcuation of GDP what this has done is basically PUSH our GDP up by significant Margin. Now is it a fake job or really hard work u guys find it out for urself.

GDP to some extent is really reflecting our total out put and reflecting our economy in true sense. Have u eva wonder how our Revenue collation gone up to ALMOST 1 Trillion ruppes. Well it is becoz we have far more sectors who have far bigger output but there were no calculated in GDP. Just put it simple word, our current GDP figure might not really reflect our TRUE GDP figure. As far as i can see is that there are many sectors which are hidden or are not put in the figures of GDP calculation. Now according to GOVERNMENT our current Revenue collation is abt 30% of our total revenue capacity. Likewise we dont get all the revenue we should get, there are sectors which are hidden which through better implementation of policy migh get calculated. SO DONT BE SURPRISED if OVERNIGHT our GDP jumps to say $200billion becoz there are many sectors missing.

2. Change of BASE year. First we are using different formula as well as base year in our calcuation. So once our BASE year changes i think it will happen every 4 years our GDP figures will be revised and PUSHED up/DOWN accordingly..


SO MANY, now will say government is doing this and that. BUT true fact is we are now better calcuating our economy and its position which will help us DIRECT our policy where needed the most....

Your comment shows your knowledge of economics. Only a fool will accept that economy can grow by 150 % in five years. You can't understand the sarcasm in it.

Good to see Pakistan making economic progress. Industrialization is vital for any country's wellbeing..

So i can assume a fool will be only one who cant go and dig up what really happend and than give retareded comments about somethin.g Ur new here so lets keep ur cool, u will learn alot along the way. Now first its not basic maths of 150% growth but rather the compounding principle comes in again, basic math X+-/ doesnt work in economics there is more to it.

Ive explaine what really happend along with the great growth of 7+% per annum. So if im u uses ur principle of simple maths than our econmy grew at 35% over last five years, which is not the case infact it grew at 40% by keeping constant growth of 7, however we have far better growth than seven couple years....

B4 going at eachothers throat y dont u go and research abt what has happend and what is behind this mircle rise in our GDP.

[quote name='1pakistani' date='Jun 15 2007, 12:57 AM' post='917777']
So i can assume a fool will be only one who cant go and dig up what really happend and than give retareded comments about somethin.g Ur new here so lets keep ur cool, u will learn alot along the way. Now first its not basic maths of 150% growth but rather the compounding principle comes in again, basic math X+-/ doesnt work in economics there is more to it.

Ive explaine what really happend along with the great growth of 7+% per annum. So if im u uses ur principle of simple maths than our econmy grew at 35% over last five years, which is not the case infact it grew at 40% by keeping constant growth of 7, however we have far better growth than seven couple years....

B4 going at eachothers throat y dont u go and research abt what has happend and what is behind this mircle rise in our GDP.
[/quotI fully agree to what you say that your economy grew by 40 % in real terms and even if we add inflation and currency revaluation , even then

2004 98.094
2005 110.970
2006 128.996
2007 141.378
2008 154.677
these figures can not be acheived. I simply want to say that accepting these figures are jsut to make fool of our selves.

Lets read my post again: In simply terms more sectors have been added and are being added to the economy on conitual basis. Our GDP really doesnt reflect our true GDP output thus we are adding sectors which were never part of our GDP calculation.

So if out GDP was $98b in 2004 it should be around $104b-$105b at growth of abt 7.5 im not sure what was the really growth. Now what if we added new sectors which were not part of our last years calculation, well than our GDP will increase more by the amount of total output of that sector which was added. This was clearl and fairly stated by the government that we added new sectors as well as change in base year occured.

so INFLATION or CURRENCY is not the cause behind this shift but rahter we are getting more aware of our economy and more sectors previously which worked underground in terms of GDP calculation are being added to our GDP.... Hope u get im say.

Listen idiot Official GDP now is $146.3 billion if u are not blind and check properly even IMF says that its just estimates. And its a fact that Pak GDP is much larger then reported by GoP.

Have you heard of compound growth? 1pakistani explained the principle pretty well. i suggest you read his posts.

That was a genius answer senior member.

Nice reply expect for name calling.

Ok I agree bringing new sectors into calculations gives in different numbers. I assume these sectors remainned for a long period without being considered. So how can current government take the credit for it.

Of course they can since new sectors will bring more revenue.

Well dickhead i hope u understand now.

Well it requires hard work and comitment from government to slove the issue of GDP sector inclusion. Now if we had lazy and ignorant leaders that they wouldnt have given a damn as long as they get what they need and that is money in the bank account. Now im not saying the current government is not corrupt but it has also given the country something the others lacked. Now better implementation of Revenue collaction and registration of business has led to inclusion of many under ground sectors. If the government wanted it could have left these sectors as they are.

Also look at our current FDI and 40% growth over the last 5 years, they speak for themself. Beside our reserve has gone up, so each and every item made a contribution which eventually led to increase in our economy. Our imports have increase as well as reseve.

Now it would be wrong not to give credit where it is due.

I may not agree on some of the above, but I empathize your view.

World is not black and white so learn to understand what is really happening. I dont care whether u empathize or sympathize im no sorry mind person, i know and i understand how to look at things from the prospective that would give me better option to judge others.

It would be intersting if u share ur view, ive told u the story behind this increase in GDP prehaps u want to share ur views.

Since you asked I'm putting it. Again it is my view, may or may not be accurate.

If the government say unproportionate increase in GDP year after year after.., to including un-included sectors that is fishy.

Again the FDI what GOP claims in reality may not be as rosy as it sounds. Major junk of the FDI is due to liquidation of Public sector units. Actually if they really want they can even double FDI for next few yrs till they run out assets to sell. It is really not that difficult to liquidate assets. It is creation of assets that is v difficult.

Im gonna terminate my argument as off now. I dont find it plausable to debate when ur dont know the facts or ur trying hide from reality. Matter of fact his year our total privatisation was $300million, if getting the figure rite and our FDI was well over $6billion. I hope u know what is the difference. BTW UAE has promosed to spend abt $100billion over next ten year some of which $42billion is investment in Island cities in Karachi. Now it will have positive effect on our economy once they start.

So rather than jsut making up stuff y dont u go and start reading abt stuff and than come and comment here. I think search button on this forum would be helpful, as most of the stuff u talking abt has been discussed b4... GOOD LUCK

Ok.. If 6 billion was the FDI done for this year, can you please elaborate on the major investments done in any field.

My contention was that this government was taking undue credit for many things happening in Pakistan.

Best example is the Forex reserve. I see this a most spoken about thing.

in 1998-99 period Pakistan's forex stood at ~ $ 2.3Billion
Last week it stands at ~ $15 Billion.

Impressive!!! But the forex of most of the emerging markets is growing. I think Pakistan would have had the same reserve of 15B even if someone than the current regime was in power.

I'm just putting India's reserve for the same period for a perspective
It was $30B on first week of 1999
today it stands at ~ $204B. For this the current government cannot take too much credit for.
And same applies for China, S Korea, Russia and so on for the period of contention.

Approximately both countries reserve has grown at the same rate. This was just an example how current GOP was taking undue credit for thinks happeing around.