Former federal minister and Professor Emeritus Dr Hafiz Pasha has estimated, with research assistance from Social Policy and Development Centre (SPDC), that the GDP growth rate in 2015-16 is likely to be 3.1%. This is substantially less than the GDP growth rate of 4.7% in 2015-16, reported by the Pakistan Bureau of Statistics (PBS).
This is the third year running that the PBS has exaggerated the GDP growth rate. Additionally, the SPDC says that in June 2014, PBS brought down the relatively high growth rate achieved in 2011-12 from 4.4% to 3.8%. This was done to demonstrate that the GDP growth rate in 2013-14 was the highest in six years.
According to the SPDC estimates, the growth rate in 2015-16 has been overstated in ten out of 18 sectors in the national economy. Almost 60% of the overstatement is in services.
The estimated alternative growth rates for agriculture are negative 2%; for industry, 5.5% and for services, 4.1%, implying a GDP growth rate in 2015-16 of 3.1% – significantly lower than the GDP growth rate achieved last year. This is consistent with the finding over the last four decades that in a year when the agriculture sector declines, the GDP growth rate never exceeds 4%.
Agriculture is important for Pakistan not only because it directly accounts for 21% of the GDP but also 60% of the manufacturing is agro-based and over 40% of trading and transport is of agricultural products.
