Minister for Planning, Development, and Special Initiatives Ahsan Iqbal Friday said the government has approved Rs. 1,100 billion development budget for the upcoming fiscal year aimed at achieving the required goals of economic growth.
Addressing a news conference in Islamabad, he said out of the total budget, Rs. 950 billion would be utilized under the Public Sector Development Programme (PSDP 2023-24) and Rs. 150 billion under the public-private partnership to execute different development schemes.
Initially, he said, the Finance Ministry had proposed Rs. 700 billion for the PSDP 2023-24 which was extremely insufficient. “We made a written request to Prime Minister Shehbaz Sharif to increase the amount of the development budget to achieve economic growth, and the PM has approved Rs. 1,100 billion development budget.”
GDP Target for FY24 Set at 3.5%
Sharing details of the targets set for the next fiscal year by the Annual Plan Coordination Committee (APCC), he said a 3.5 percent growth target has been fixed for the gross domestic product (GDP).
As per the next year’s Annual Development Plan, he said, the inflation rate would be brought down from 29.2 percent to 21 percent, the national savings to be increased from 12.5 percent to 13.4 percent, exports to be taken over $30 billion as compared to the current year’s projected $28 billion, while imports have been projected at $58.7 billion for the next year and the trade deficit that currently stood at 1.1 percent, to be brought down to -1.7 percent.
Later, the Chief Economist apprised participants about the economic performance achieved during FY23 and growth projections for FY24. He said that during FY23, due to high inflation, caused by unfavorable external environment, floods, and import compression measures, only marginal economic growth was recorded. He highlighted the significant improvement in fiscal and current account balances, which he termed as a positive sign for the revival of growth during FY24.
The Chief Economist presented an economic outlook for FY24, which he said will result in an orderly rebalancing between economic growth, and current and fiscal account balances. However, he also raised caution about a global slowdown, increased interest rates in developed countries, and elevated commodity prices which may hinder the country’s economic plans.