Pakistan’s GDP grew 2.13% in 1QFY24, in line with expectations

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  • To meet the structural benchmark under the IMF Stand By Agreement (SBA), the National Accounts Committee (NAC) approved annual estimates of GDP for the years FY22 (final), FY23 (revised) and released quarterly estimates for 1QFY24.
  • To recall, as per structural benchmark, “PBS will compile and disseminate the First Quarter estimates for 2023-24 and the revised annual estimates for the financial year 2022-23 by end of November 2023.”
  • To highlight, this is not the first time the government is releasing quarterly GDP numbers, the same practice was also seen in FY13-FY14 when the government released quarterly numbers but discontinued after a few quarters.
  • As per NAC, final GDP growth rate for FY22 has been estimated at 6.17%, which was 6.10% in the revised estimates. Similarly, revised growth rate of GDP for FY23 is estimated at -0.17%, which was provisionally estimated at 0.29%.
  • The NAC also approved the 1QFY24 GDP growth, which is estimated at 2.13%, compared to 0.96% in 1QFY23. In 1QFY24, Agriculture has shown a growth of 5.06%, industry 2.48% and services 0.82%.
  • As per press release, 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.
  • The 1QFY24 annualized GDP numbers are in line with our expectations. For the full year FY24, we anticipate an overall GDP growth of 2.9%, with an expected growth of 4.0% in Agriculture, 3.7% in Industry, and 2.2% in Services.
  • State Bank of Pakistan (SBP) estimates that GDP growth for FY24 is in the range of 2-3% in its annual report released on Oct 23, 2023. The IMF, in its country report in Jul 2023, projected a growth rate of 2.5% for FY24, while the World Bank, in its Oct 2023 Pakistan Development Update, projected a GDP growth rate of 1.7% for FY24.

Courtesy- Topline Pakistan Research 

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