Despite several internal and external challenges, Pakistan's gross domestic product recorded its highest growth in 10 years of 5.3 per cent during the outgoing fiscal year 2016-17, the finance minister informed on Thursday.
"The growth rate was just three per cent in 2013, which has now risen to 5.3 per cent and this growth is also being acknowledged at the world level," Senator Mohammad Ishaq Dar said while launching the Pakistan Economic Survey for the outgoing fiscal year in Islamabad.
He said that the overall size of country's economy has crossed the threshold of $300 billion during the current year, which was a healthy sign.
Keeping in view the current growth rate, the GDP growth rate target for the upcoming 2017-18 fiscal year has been fixed at six per cent, the minister said, hoping that the target would not only be achieved but exceeded.
He said that during the outgoing fiscal year, the agriculture sector posted a growth of 3.5 percent, which was a positive sign. He attributed the growth to incentive packages announced in the last budget to farmers.
The minister said that the policy rate has been reduced to 5.75 percent, which was at the lowest level in last 45 years.
Economists believe that the public debt of an economy increases when it is unable to meet its expenditures through own resources (tax and others) and to bridge the gap (that is called fiscal deficit), it borrows more from local and foreign lenders.
Interestingly, on debt servicing (paying interest and principal amount), the government has spent huge amount of Rs.1.41 trillion during July-March 2016-17. Meanwhile, the amount Pakistan paid for its servicing is 45 percent of the country’s revenue against 46 percent last year.
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