Economy of pakistan
- GDP Growth rate = 4.24% as compare of 2.7 % of previous.
- Agriculture sector accounts for 20.88 % of GDP, 43.5 % of employment..
- Growth rate of Agriculture= 2.9% (2.9% in prev year),
- Important crops contains 25.6 % of agri value and 64.5 % in overall crops
- Other crops contain 11.11 % agri value and contribute 2.3% of GDP
- Cotton ginning has 2.9% share in agriculture and .6% in GDP
- livestock share 56.3 % in agriculture, 11.8% to GDP, grew at 4.12%
- Forestry shares 2.0% in agriculture, growth rate 3.15%
- Fisheries share 2.1% in agriculture, growth rate 5.75%
- Industry sector accounts for 20.30 % of GDP
- Industrial growth rate= 3.6 % (4.5% in last year),
- Four sub sectors: Mining & quarriying, manufacturing, Energy generation & distribution, construction
- Manufacturing contributes 13.3% to GDP, employees 14.2% of labor
- manufacturing growth 5.5%
- LSM (Large scale manufacturing), 10.68 % to GDP, 11 % of industry and 80 % of manufacturing
- LSM growth rate : 2.5%
- SME/SSM growth rate 8.2%, 1.7 % to GDP, 13 % to manufacturin
- Construction contributes 2.4 % to GDP, 12% share to Industry, employees 7.33% of labor force, growth rate 7%
- Mining & quarrying 2.9% in GDP, 14.4% to Industry, growth rate 1.6%
- Power Generation and Distribution contributes 1.7% tp GDP, 8.2% in industry and grew at 1.9%
- Services sector accounts for 58.82% and growth rate 4.95 %
- Six sub sectors: Transport, Storage & Communication, Wholesale & Retail Trade, Finance & Insurance, Housing, General Govt./Defense Services/Public Administration, Private Services/Social Services
- Wholesale and retail trade grew at 3.38%
- Transport, Storage and Communication grew at 4.21%, employees 5.44 % of labor force
- Housing Services grew at 4%
- Other Private services grew at 5.94%
- Finances and Insurance grew at 6.2% against 5.8 last year
- General Govt. services grew at 9.4% 9increase in pay & pension, low default rate)
- Total investment to GDP improved at 15.1% as compared to 13.9% last year
- Fixed investment to GDP 13.52%
- Private investment 9.66% of GDP
- Public investment gre at 25.56%
- KSE 100 index witnessed highest in history
- Market capitalization $ 71.8 billion
- FDI inflows : grew at 10.2 % and reached at $ 2057.3 million
- Savings improved to 14.5% ------Rs. 4140 billion
- Remittances reached at $ 14969.66 million, growth of 16.06 %
- Gross fixed Capital Formation (GFCF) Rs. 3702 billion – 10.3 % increase
- Commodity Producing Sector accounts for 41.2 % of GDP, growth rate 3.24%
- Declining oil prices led to shortfall in FBR collection by Rs. 205 billion
- Fiscal Development
- Fiscal Deficit: 3.8 % (July-March 2014-15)
- Fiscal /Budget Deficit 5% of GDP (FY 2014-15
- Trade deficit: 0.7%
- Foreign Ex. reserves(of country): $ 17.739 billion, +ve change of 25%
- Total Revenue grew by 8.3% and reached Rs. 2682.6 billion
- Total tax collection Rs. 2063.2 billion, growth rate of 15.5 %
- FBR collected Rs. 1972.4 billion with a growth rate of 13% (GST on Petroleum 27%, 2% withholding tax on non filers)
- Total Expenditure Rs. 3731.6 billion against Rs. 3446.2 billion
- Current Expenditure grew by 10.1% and reached Rs. 3199.1 billion
- Dev expenditure and net lending grew by 6.9% and reached Rs. 594 bill
- PSDP grew by 27.1% and reached Rs. 499.4 billion
- Decline in current subsidies from Rs. 201.8 billion to Rs. 185.9 billion
- Money and Credit
- SBP Discount Rate in monetary policy = 7%
- Broad money M2 witnessed increase of 7.33% and stood at Rs. 730.5 bill
- Net Foreign Assets (NFA) grew and stood at Rs. 220.1 billion
- NDA of banking sector grew by 5.45% and stood at Rs. 510.5 billion
- Govt. borrowing for budgetary support Rs. 601.1 billion against 240.2 pre
- Credit to Private sector grew by 4.3%
- Decline in NPL ratio to 12.3%
- Capital Adequacy ratio (CAR) of banking 17.4%
- Pak Rupee recorded a depreciation of 3.1 %
- Capital Market:
- 27 % return for investors (31 % return in terms of US $)
- Gained 6870 points till 32131 level
- Auto sector top performer with market capital increase by 133 %
- Domestic Sukuk : Rs. 26 billion
- International Sukuk : $ 1 billion
- TFC’s : Rs. 6 billion
- Mutual Fund Industry stood at Rs. 510.920 – increase of 14%
- Portfolio of National Saving (NSS) Rs. 2938920.21 million constituting 25 % share of overall domestic debt of GOP.
- Education
- Literacy Rate 58 % as compared to 60 % last year
- LR in urban and rural areas 74% and 49 % respectively
- LR for men and women 81 % and 66% respectively
- Province wise LR for Punjab 61%, Sindh 56%, KPK 53%, Balochistan 43%
- Increase in enrollment by 2.4% reached 42.1 million
- Health
- Expenditure on health 0.4 % of GDP – Rs. 114.2 billion
- Calories intake per day per person increased from 2484 to 2490 – 0.24 % increase
- Medical Facility ratio: 1073 persons / doctor, 12447 persons / dentist, one hospital bed for 1593 persons
- 1142 hospitals, 5499 dispensaries, 5438 BHU, 669 RHC’s, 118041 beds in hospitals.
- 175223 doctors, 15106 dentists, 90276 nurses in the country
- Population & Employment
- Estimated population 191.71 milion, growth rate 1.92 %, 6th populous country
- Unemployment rate : 6%
- Total labor force 60.09 million, 56.52 are employeed
- 49 % of overseas Pakistanis are in middle east, 28.2% in Europe, 16 % in USA,
- Manpower export increased to 0.752 million
- Per Capita Income: $1512
- Transport and Communication
- NHA – highways, expressways, motorways of about 12313 km, portfolio of 72 projects costing Rs.1342 billion
- Pakistan Railway
- Revival of PIA, losses reduced from 44.3 bill to Rs. 32 billion
- Ports and shipping earned Rs 11.424 billion –
- Karachi Port Trust 11.5 km long, 12 meters deep, turning basin of 600 meters provides upto 75000 metric tons deadweight and handled 31.133 mill tons of cargo
- Total volume of Port Qasim 15.189 mill tons
- Gawadar Port – future centerpiece alongwith china
- Energy
- Last year govt retired circular debt of Rs 480 billion, now again circular amounts Rs. 250 billions including current payments
- Turkmanistan-Afghanistan, Pakistan-India (TAPI) pipeline ($10-12) will be materialized till 2017 will provide 1.3 billion cubic feet gas to Pakistan
- Jamshoro Power project will be complete in 2018 with 1300 MW.
- Enhancement of distribution network and upgradation of 284 grid stations with investment of $ 167.2 miilion
- Dasu Hydro Power –I on Indus River through IDA credit of $ 588.4 million will add 2160 MW.
- Different MoU signed with china on energy projects of coal, wind, sola, and hydro project by 2017 adding 10400 MW
- Neelum Jehlum Hydropower to be completed in 2016
- Telecom: Total Subscribers 134 million
- Allocation of 4.5% of GDP to social safety Nets through BISP, PPAF, RSPNs, Pakistan Bait-ul-Mal
- Foreign Exchange reserves(of SBP): $ 12.550 billion as on 8th May
- Public Debt 61.8% of GDP – Rs. 16936 billion, increase of 940 billion from prev
- Public Debt servicing Rs. 1139 billion – 44.5 % of total revenues
- EDL stock $ 62.6 billion out of which external public debt $ 49.1 billion
- Three main drivers of economic growth are consumption, investment and export
- Inflation: 4.8 %, Food and Non Food Inflation 3.6% and 5.7 % respectively
- Import Volume: $34.086 billion – decline of 1.61%
- Export Volume: $20.176 billion - 3% decline
- External Account posted a surplus of $2.12 billion
- Current Account deficit: $ 1.364 billion (.06% of GDP), 53.5 % less than prev
- Tax to GDP ratio= 8.7% (min average in world is 15%)
- If Poverty line= $2 per day then 60.19% Population fall below poverty line in Pakistan. In china 29.7%, India 68.7% and Bangladesh 76.5% of population is below poverty line.
- Financial Account balance: $2.836 billion
- Sale of EURO Bonds: $ 2 billion
- Issuance of Sukuk bonds in international market: $ 1 billion
Budget 2015-16
- Total Outlay : Rs.4451.3 billion – 3.5 % higher than previous,
- Estimated gross revenue receipts are Rs.4,313 billion , 9.1 % higher
- Estimated net revenue receipts Rs 2,463.4 billion with 3.6 % increase,
- Est. provincial share in federal taxes Rs 1,849.4 billion 17.4 % higher,
- Estimated net capital receipts Rs 606.3 billion with decline of 12.2 %,
- Estimated external receipts Rs 751.5 billion 12.1 % higher.
- Estimated expenditure Rs 4,089 billion, 4.8 % higher
- Current expenditure is Rs 3,128 billion (78.2%)
- Defense Budget Rs.780 Billion, 11 % higher
- Development Budget is Rs 700 billion, 29 % higher
- Size of PSDP Rs 1,513.7 billion
- Target Budget deficit 4.3 % - that is Rs. 1625 billion
- Taxation
- Capital gain Tax 15 % and 12.5 % for securities held for 1 year and 2 years respectively and 7.5 % for holding securities for 2-4 years
- For commission agents/non filers increased to 3 % against 2 %
- Adjustable Advance income tax on banking instruments 0.3 % (Cheques)
- Income tax for banking companies income @ 35%
- For dividend income 12.5%, for non filers 17.5%, for mutual funds 10 %
- Adjustable adnace income tax @ 0.1% for each transaction at PMEX
- Adjustable advance income tax of 7.5 % at electricity bills amounting to Rs. 75000/-
- A tax @ 10 % for not distributing dividend
- An additional withholding tax of 10 % for renting machinery, equipment, scientific instruments alongwith already final tax of 15 %
- Additional one time tax of 3 % on banking companies and 4 % for others having income above Rs. 500 million for rehabilitation of TDPs
- Proposed income tax of 32 % for companies instead of 35 % earlier in lieu of 1% reduction strategy annually.
- Tax credit for enlistment is increased to 20 % against 15% earlier
- Tax credit for new investment – limit is proposed to increase to 1.5 million against Rs. 1 million earlier
- Reduction in Withholding Tax On Token Tax by 20-25% for tax filers
- Reduction in Withholding Tax On Transfer of Vehicles by 75 % for tax filers and one third for non filers
- Reduced income tax of 25% for small company and propsed limit enhancement to Rs. 50 million
- Reduction in income tax to 2% for salaried persons with income 4 – 5 lac, and 7% for non salaried persons having income between 4-5 Lac
- FED on cigarettes increased from 58 % to 63%, 0.75% on each filter rod
- Rates of further tax enhanced from 1 % to 2%
- Sales tax on Mobile phones increased from 150, 250 and 500 rupees to 300, 500 & 1000 rupees respectively
- FED on aerated water increased from 9% to 12 %
- Reduction in maximum tariff slab from 25 % to 20% and reduction in number of slabs from 6 to 5
- Powers of FBR to issue exemptions are withdrawn and subjected to circulars through parliament
- Construction
- Markup on housing credit be deductable to income upto 50 % of taxable income or Rs. 1 million
- Sales tax on bricks and crushed stones is exempted for 3 years.
- Custom duty on import of construction machinery is reduced from 30% to 20%
- Tax/mport duty exemption for solar panels
- Agriculture
- Income Tax holiday of 3 years for agri supply chain if set upto 2016
- Tax exemption for halal food manufacturers for four years if set upto 2016
- Reduction of sales tax from 17 to 7%, withholding tax to 0%, and import duty to 2 % o n import or local supply of agril machinery
- Income Tax reduction for rice mills to minimum level
- Interest free loansof Rs. 1.1 million for solar tubewells against deposit of Rs. 100000
- Estimated bank borrowing Rs 282.9 billion
- NFC Composition: Punjab 51.74%, Sindh 24.55%, KPK 14.62 %, Baluchistan 9.09 %
- Expenditure on General Public Services is 70.3 % of current expenditure
- Income tax holiday for all manufacturing units set up in KPK upto 2018
- 7.5% adhoc relief allowance on running basic pay, merging of previous adhoc relief allowances to basic pay, medical allowance increased to 25 %. 7.5% increase in pension
- Minimum wage rate.Rs 13000
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Anyone who thinks the sky is the limit, has limited imagination.
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Muhammad Irfan Arshad
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Saturday, November 28, 2015
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