Pakistan’s economy underwent a significant contraction in 2022-23, marked by a substantial decline in GDP size in dollar terms, growth rate, and per capita income, leading to the slowest increase in the country’s total output in the past four years.
The downturn, indicating serious mismanagement by the ruling PML-N coalition, starkly contrasts with the rapid 6.1pc expansion achieved under the previous PTI government in FY22.
The dollar-valued GDP shrunk to $341.554 billion in FY23 from $375.449bn in FY22, largely due to unprecedented rupee depreciation.
The per capita income dropped to $1,568 in FY23 from $1,766 in FY22 and $1,677 in FY21, pointing to a lowered standard of living and diminished personal incomes. This could lead to a reduction in disposable income, thereby limiting people’s ability to spend, save, or invest.
Read: Pakistan’s Economic Slowdown: A Snapshot of 0.3% Growth Amid Challenges
The preliminary GDP growth rate for 2022-23 is a mere 0.29pc. The agricultural sector witnessed a positive growth of 1.55pc, primarily due to increases in wheat, sugarcane, and maize yields. However, the industrial sector experienced a decline of 2.94pc, and the services sector saw a sluggish increase of 0.86pc. Negative growth in large-scale manufacturing (LSM) also played a part in the industrial downturn.
Despite certain crops showing modest growth, cotton and rice production faced significant drops, affecting the overall agricultural output. This challenging economic landscape reflects the country’s struggle to balance sector-specific trends and their impacts on overall economic growth.
