Federal Minister for Planning, Development and Special Initiatives Ahsan Iqbal Tuesday announced that the government had approved GDP growth target of an estimated 3.5 percent for the 2023-24 financial year (FY24).
Addressing a press conference after the meeting of the National Economic Council (NEC), the minister said that government would spend Rs. 1,150 billion under the Public Sector Development Programme (PSDP 2023-24).
The NEC has proposed the Annual Development Plan (ADP) for the FY24 with a total outlay of Rs. 2.709 trillion. “The total national outlay contains the development budget of Punjab and Khyber Pakhtunkhwa for only four months [due to caretaker set up), but if their full budget is included in the ADP, it will exceed the figure of Rs. 3 trillion,” the minister highlighted.
The size of of PSDP 2023-24 includes foreign aid of Rs. 75 billion and PPP/BOT funding of Rs. 200 billion which is 46 percent higher than revised estimates of Rs. 787.2 billion for FY23. Around 52 percent of total allocation has been proposed for infrastructure sector to ensure modern infrastructure and to attract foreign direct investment.
The government also expects inflation to remain at 21 percent during the FY24. It is pertinent to mention here that the consumer price inflation (CPI) for July-May FY23 is at 29.2 percent.
The government’s setting of a growth target of 3.5% for FY24 is a positive and ambitious move that signals confidence in the country’s economic prospects. While some may have expected a more conservative growth projection, aiming for 3.5% demonstrates a commitment to fostering economic expansion and resilience.
A higher growth target signifies the government’s determination to accelerate economic recovery and create opportunities for businesses and individuals. It indicates a belief in the potential of various sectors to contribute to economic growth, generate employment, and improve living standards.
Setting a higher growth target can also serve as a catalyst for attracting domestic and foreign investment. It sends a positive signal to investors, demonstrating the government’s commitment to creating an enabling environment and supporting economic activities.
Moreover, a higher growth target can have positive spillover effects on various socio-economic indicators, such as poverty reduction, improved healthcare, and enhanced infrastructure development. It provides an opportunity to address key challenges and invest in sectors that have the potential to drive sustainable growth and development.
While achieving a 3.5% growth target may require concerted efforts and effective implementation of economic policies, it also reflects a proactive approach to overcome the impact of the COVID-19 pandemic and pursue a path of robust economic recovery.
It is important to remember that setting a growth target is a forward-looking aspiration that guides policy decisions and actions. It encourages stakeholders to work towards achieving higher levels of economic output and productivity.
Overall, the government’s decision to set a growth target of 3.5% for FY24 demonstrates optimism and a commitment to economic progress. It provides a framework for policy planning and implementation, aiming to create a favorable environment for sustainable growth, job creation, and improved well-being for the people of the country.