In: Categories » Education and reference » Politics and society » REGIME OF MR. SHAUKAT AZIZ
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ECONOMIC ACHIEVEMENTS : Before the regime of Mr. Shaukat Aziz in Government, Pakistan was in severe economic crisis with our debt in default, low growth, high inflation, depreciating currency and virtually non existent investment. But today Pakistan have a vision and an opportunity to excel even more. In these few years his government has not only consolidated the economic recovery that began in early year 2000 but also the economy of Pakistan continued to gain traction as it experienced the longest spell of its strongest growth in the last three years. Pakistan’s growth performance over the last three years has been striking. The commodity-producing sectors (agriculture and industry) contributed 30% and services sectors contributed the 60% to the average real GDP growth of 7.5 percent in the last three years which was the best performance since many decades. ECONOMIC INDICATORS: During the current fiscal year as well over the last three years growth in the agriculture sector bounced back from a modest 1.6 percent last year to 5.0 percent. Wheat production was up by 10.5 percent to 23.5 million tons, the highest ever wheat production recorded in the country’s history. The LSM sector grew at an average rate of 13.1 percent during 2004-07 and at 8.8 percent during 2006-07. The relatively slower pace of expansion in 2006-07 was due to the moderation and difficulties in the textile sector and lower than expected scale of operations of oil refineries. The last few years’ economic growth was mainly driven by strong domestic demand, with investment taking lead over consumption for the first time in the period under discussion. Increased contribution of investment to growth in 2006-07 was a healthy development as it generated employment growth which supported consumption demand thus playing an important role in sustaining strong growth momentum in the medium-term. One of his main achievements was highest ever foreign investment flows at $ 8.4 billion in 2006-07 as compared to $ 1.6 billion in 2004-05, emerging as the single largest source of external finance after exports; which were $ 16.7 Billion in 2006-07, as foreign investment of this magnitude reflects the confidence of global investors on the current and future prospects of Pakistan economy. Per capita income in current dollar term also increased to $ 925 in 2006-07, an increase of 38.3 percent in the last three years of Mr. Shaukat Aziz as a Prime Minister. Price pressure declined from 9.3 percent in 2004-05 to 7.8 percent in 2006-07 owing to pursuance of tight monetary policy on the one hand and improvement of supply situation on the other. On the fiscal side, the average budget deficit now remains at less than 4.0 percent of GDP and revenue collection target of the Federal Board of Revenue (FBR) not only achieved but also consistently surpassed the target. SOCIAL INDICATORS: During his tenure, social indicators were not ignored and due to strong economic growth, large inflow of remittances and spending on social sector and poverty-related program during 2001-02 till 2006-07 succeeded in reducing poverty in Pakistan as headcount decreased from 34.5 percent in 2000-01 to 23.9 percent in 2006-07. Unemployment declined from 7.8 percent to 6.2 percent whereas literacy indicators, such as gross and net enrollment at primary level and literacy rate also improved significantly over the last 5 years. In regards to health indicators, children immunization, incident of diarrhea and infant mortality have improved appreciably. OTHER SIDE OF THE PICTURE: While the structural reforms and supportive macroeconomic policies were successful in transforming Pakistan into a stable and resurgent economy there were however some weaker areas. The challenge for the government is therefore to maintain a balance between the supply and demand for essential food items by enhancing domestic production to keep the core inflation in check. The inventory and logistics problems created a demand supply gap for essential food items; this gap aggravated the inflation rate. As we all know that Pakistan has become one of the fastest growing economies in South Asia but still the current account deficit has further widened even though import growth has slowed. At this point of stage we can not ignore the importance of exports. Although Pakistan’s export performance in the past few years has been improving year by year, but still we were not able to achieve last year’s export target of $ 18.7 Billion. We have seen how some countries, learning from our initial experience, surpassed us economically and have become Asian Tigers. Now we need to emulate them if we also want to be an economic giant. The maximization of export is the need of the hour and we need to take concrete measures for export promotion. Pakistan’s industrial structure and exports lack diversification not only in terms of products but also in terms of markets. We need to acquire state-of-the-art technology, develop human capital to increase productivity level, improve efficiency and increase the funds allocation for research and development. We also need to improve the quality of our exports to develop credtibility in foreign markets. CONCLUSION: REFERENCES:
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