ISLAMABAD – The World Bank has slashed its outlook for Pakistan’s economic growth by half for the current fiscal year in wake of the dilapidating economy in the South Asian country.
As per the World Bank’s latest forecast, the real Gross Domestic Product (GDP) of cash strapped country is likely to grow at 2.0 percent in FY23 as global growth is also expected to slow amid soaring inflation, rising interest rates, and the Russia-Ukraine war.
It projected that the fifth most populous nation is facing mammoth economic challenges, revealing that improvements in living standards over the half-decade to 2024 are expected to be slower than from 2010-19.
WB said Islamabad’s economic output not only declined but also brought down the regional growth rate.
It pointed out policy uncertainty that complicates the ‘economic outlook’, other than the massive floods and sharp increase in poverty. It said around one-third of the country’s land area was damaged after deluges.
Floods badly damage agricultural production, which accounts for 23pc of GDP and 37pc of employment, forcing more than 5 million into poverty, the report further mentioned.
The WB makes projections as Pakistan is facing the lowest foreign exchange reserves in almost a decade while the Pakistani rupee depreciates by 14 percent, and inflation skyrocketed to 24.5pc last month.
