The Asian Development Bank ( ADB) has projected that Pakistan ‘s economy will regain some pace and grow at 2% in the upcoming fiscal year 2020-21, after contracting by 0.4% in the 2019-20 fiscal year following the Covid-19 pandemic.
In a regular supplement to its annual flagship economic publication, the ADB stated the Asian Development Outlook (ADO) 2020 that Pakistan’s inflation rate would remain at 11 percent compared with the earlier projection of 11.5 percent in the current fiscal year ending June 30.
The bank said, “Pakistan’s economy was on its way to recovery before Covid-19, and once the Covid-19 impact subsides, Pakistan will resume its efforts to address macroeconomic imbalances and initiate structural reforms, likely to hold economic growth to a projected 2.0 percent in FY2021.”
The inflation rate in Pakistan would remain at 11 percent compared to the current fiscal year’s earlier projection of 11.5 percent, “he said, adding that the inflation rate would remain at 8 percent compared to the previous projection of 8.3 percent in the next fiscal year.
The supplement said the economy in South Asia, which had been hit hard by Covid-19, was forecast to contract by 3.0 percent in 2020 compared to the growth of 4.1 percent predicted in April. It added the forecast for India to contract by 4.0 percent in the fiscal year 2020, ending on March 31, 2021, before growing by 5.0 percent in 2021.
The ADB said emerging Asia as a whole will barely expand in 2020 as containment measures to combat the coronavirus pandemic impeded economic growth and reduced external demand. It predicts growth for the region in 2020 of 0.1 percent – down from April’s 2.2 percent estimate.
The 0.1 percent growth would be the regions slowest since 1961. Excluding Hong Kong, China’s newly industrialized economies; the Republic of Korea; Singapore; and Taipei, China, developing Asia is forecast to grow 6.6 percent in 2021, “the supplement said.
ADB Chief Economist Yasuyuki Sawada said in a statement, “Economies in Asia and the Pacific will continue to feel the blow of this year’s Covid-19 pandemic even as lockdowns are slowly eased and selected economic activities restart in a ‘new normal’ scenario.”