ISLAMABAD: The Asian Development Bank (ADB) in its latest reports released on Wednesday said that Pakistan's economic outlook is expected to stay modest as its growth during fiscal year 2012 would hover around 3.6 percent.
The ADB in its annual flagship publication, the Asian Development Outlook (ADO) 2012, reports that fiscal developments for FY2012 present a mixed picture.
The report says that Federal Board of Revenue (FBR) collections are much improved, running a full 33 percent ahead of last year's performance for the first 6 months.
This reflects improved economic activity in the first half of the year, as well as extension of the flood-related tax surcharges and improvements to tax administration.
Yet meeting the overall revenue target for FY2012 in part depends on the sale of third-generation telecoms licenses in the latter part FY2012-a sale already rescheduled over the past 2 years, it adds.
According to the report, the external accounts returns to deficit, with scant cushion from the financial and capital accounts.
Lower prices for key export commodities, particularly cotton, combined with higher import prices, pushed the current account from near balance for the first 7 months of FY2011 to a deficit of to a deficit of $26 billion (1.8 percent of GDP) by end-January 2012.
Workers' remittances expanded by 23.4 percent during July 2011- February 2012, slightly slower than the pace for the same period a year earlier.
However, the economy will remain exposed to balance of payment pressure in the current international environment and subdued growth in other Asian countries, says the ADB 2012.
Beyond the immediate fiscal and energy improvement steps, the country needs clear business plans to boost the economy, in particular manufacturing and infrastructure development, to sustain growth and generate jobs.
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