Indicators Show Gradual Recovery Of Corona-hit Economy

Despite enormous challenges at external as well as internal fronts due to outbreak of coronavirus and subsequent lockdown, the country's economic indicators show that coronavirus-hit economy was not only recovering now but was also showing steady growth and gaining stability as suggested by the data of first month of the current fiscal year (July 2020).

ISLAMABAD, (UrduPoint / Pakistan Point News - 13th Aug, 2020 ) :Despite enormous challenges at external as well as internal fronts due to outbreak of coronavirus and subsequent lockdown, the country's economic indicators show that coronavirus-hit economy was not only recovering now but was also showing steady growth and gaining stability as suggested by the data of first month of the current fiscal year (July 2020).

Likewise, the global entities, monitoring the performance of different economic sectors across the world, have also started recognizing the growth of Pakistan economy as is indicated by reports and rating indices they published.

During the month of July 2020, Pakistan's exports registered an increase of 6.04pc, from $1.886 billion last year to $2 billion, whereas imports declined from $3.713 billion to $3.640 billion, showing fall of 1.97pc. Based on the figures, the trade deficit witnessed a reduction of 10.24pc during July.

The revenue collection by the Federal board of Revenue (FBR) during the first month of the current fiscal year increased to Rs300 billion, which is 23 percent more than the collection of the same month of last year.

Advisor to Prime Minister on Finance and Revenue, Dr. Abdul Hafeez Shaikh, while talking to media said that the economic activity was gaining momentum as there was 22 percent increase in the consumption of cement; the use of petrol and diesel has increased from 6 to 10 percent while the automobile sale has also increased in the month. The pakistan stock exchange (psx) has also been performing very well and has already crossed the benchmark of 40,000 shares.

These development indicate increase in economic activity, said the advisor, however there was need to carry forward this trend and the government has introduced comprehensive strategies for this purpose.

On the other hand, both International and domestic confidence was increasing and this could be observed by the performance of Pakistan Stock Exchange, which was declared second largest market in terms of growth by the Bloomberg. In addition, the Moody's rating agency also provided stable rating for Pakistan economy and confirmed its B3 credit rating. The finance ministry termed the development as an affirmation of the government's sound fiscal and financial policies in these times of unprecedented hardship and uncertainty. Federal Minister for Planning, Development & Special Initiatives, Asad Umar termed the development as testimony of the V-shaped recovery while Federal Minister of Industries and Production, Hammad Azhar said it was an encouraging sign and outcome of prudent policies of the government.

It is well-known fact that the Coronarirus (COVID-19) outbreak and the subsequent lockdown drastically damaged the world economy and Pakistan was no exception which witnessed negative GDP growth.

However, due to the prudent policies adopted by the incumbent government, the economic losses were not only mitigated and but the economy was also put on the track which is now showing signs of recovery.

The government adopted a balanced policy during the coronavirus spread, aimed at striking a balance between protecting people from virus and continuation of economic activities. It got successful not only in controlling the spread of COVID19 but also saving total collapse of economy. The corona-oriented relief package of Rs1200 billion to ensure people with liquidity, incentives for small and medium size enterprises (SMEs) and export sector, in addition to several budgetary measures including no new taxes, reduction in duties and cut in government expenditures were introduced to come out of the crisis successfully.

The country's smart lockdown policy was not only appreciated at domestic level but gained popularity across the world and many countries followed the suit. The business community and traders hailed the smart lockdown strategy, saying that it benefited the local businesses, especially export and construction sectors.

"The government provided good incentives to the local industrial sector, especially export-oriented businesses besides offering huge relief package to the constitution sector," President Islamabad Chamber Commerce and Industry (ICCI) Muhammad Ahmed Waheed told APP. He said that the government came up with a comprehensive strategy that helped mitigate the losses the businesses community might have faced due to coronavirus spread.

Meanwhile, President Rawalpindi Chamber of Commerce and Industry (RCCI) Saboor Malik said that as compared to other regional economies, the government adopted balanced approach to deal with COVID-19 challenges.

There is also no denying the fact that coronavirus posed second largest challenges to the government of Pakistan Tehreeek-i-Inshaf after assuming power in 2018. The first huge challenge it had to face was to stabilized the collapsing economy it had inherited from previous government. However, soon after assuming the power, the government took some drastic policy measures, though tough, and was able to put the economy on the growth path until it came across a new and vast challenge in the form of Coronavirus. This challenge was also dealt with prudent policies that are now bringing fruit in the form of stability and as indicated by the latest developments, the country would come out of this crisis successfully.