The intelligence unit of the well-known English journal The Economist has released a report on Pakistan’s economy, in which political instability, security and economic weaknesses have been described as major problems.
The Economist said in its latest report that the current government has lost popularity due to the increase in inflation and tax burden. Pakistan has to repay 77.5 billion dollars in foreign debt in four years.
It is predicted in the report about the fall of the rupee that the dollar will reach 291 rupees in 2023, 302 rupees in 2025, while the rupee will remain weak during 2024 to 2027.
The interest rate is also likely to increase by 2 percent to 23 percent. The economic growth rate will be 1.5 percent this year and negative 0.2 percent next year.
Unemployment in Pakistan will rise to 9.6 percent this year and 9.9 percent next year. The intelligence unit suggested that Pakistan would have to take a new IMF program to avoid default.
Besides, today the finance ministry has released a report on loans, according to which the volume of loans has increased due to the increase in interest rates.
Both inflation and debt increased due to increase in interest rate and dollar exchange rate in the country.
The report predicted that inflation in the country will remain at 28.5 percent this year, the inflation rate will remain at 21 percent in the next financial year, Pakistan’s public debt is still risky, and debt is expected to be more than 70 percent of the economy by 2026. Inflation may rise to 6.5 percent in 2026, the dollar exchange rate is also likely to increase by 6 percent.
The economic growth rate is expected to be only 0.8 percent in the current financial year.
The exchange rate of the dollar increased by 11 percent from July to December, the total debt of Pakistan by December 2022 was 55 thousand 800 billion rupees and in it the local debt is 62.8 percent while the foreign debt is 37.2 percent. According to the report, July to December is 3.2 billion dollars. Foreign loans of 2.7 billion dollars were taken and returned.
Inflation rate is expected to be 21 percent and economic growth rate of 3.5 percent in fiscal year 2024. Inflation rate is expected to be 7.5 percent and economic growth rate of 5 percent in 2025. While in the financial year 2026, the rate of economic growth will be 5.5 percent.
