Debt Sustainability Analysis report sounded alarm for country’s economy
Report of Economic Advisory Wing of Ministry of Finance predicted growth rate to be less than 1% this fiscal year, while inflation rate is likely to be 28.5%
Economic Advisory Wing of the Federal Ministry of Finance has predicted that economic growth rate will be less than 1% i.e. 0.8% in current fiscal year, while the growth rate is expected to be 3.5% in the next year.
In the “Debt Sustainability Analysis” (DSA) report of the Economic Advisory Wing of the Ministry of Finance, the economic growth rate for this financial year has been predicted to be less than one percent, i.e. zero point eight percent.
The Debt Sustainability Analysis Report of the Federal Finance Ministry has said that the economic growth rate will be 0.8 percent this fiscal year, but the growth rate is expected to reach 3.5 percent in the next fiscal year and 5 percent in 2025.
According to the report, the real GDP growth rate is expected to be 0.8% in FY23 due to catastrophic floods, tight fiscal stance, financial stability, and an unfavorable global economic environment, but it is likely to increase next year.
According to the DSA report, the growth rate was expected to increase to 5.5% in FY26 but efforts will be required between the federal and provincial governments to ensure coherent sustainable economic growth.
The report states that the debt-to-GDP ratio is likely to remain at 77 percent while public debt risks are high. Inflation rate is expected to be 28.5% this fiscal year.
According to the Debt Sustainability Analysis report, the inflation rate will reach 21 percent in 2024 and seven and a half percent in 2025. Inflation will pick up further in FY23 and remain high in the next fiscal.
The Finance Ministry has acknowledged that it will take more time to ease inflationary pressures, but current measures and sustained economic growth should bring inflation down to 6.5 percent permanently by FY26.
