1. Economic Instability in Pakistan Presented By: Junaid Naseem Intelligence Officer

2. Outline of the Presentation What is Economy Economy Of Pakistan Economic History Economic Indicators of Pakistan Causes of Economic Crisis in Pakistan Challenges to Pakistan Economy Conclusion

3. Economy An economy, or Economic system, is the way a nation makes economic choices about how the nation will use its resources to produce and distribute goods and services.

4. Currency Pakistani rupee (PKR) Rs.1 = 100 Paisas 1 USD = 134.44 PKR (As on 26 November 2018) Fiscal year 1 July – 30 June Trade organizations WTO, SAARC, ECO, OIC, SAFTA, AIIB, SCO, IMF, Commonwealth & Nations, World Bank

5. 25th largest in the world in terms of purchasing power parity (PPP) 42nd largest in terms of nominal gross domestic product. 147 th in term of nominal GDP per capita of $1,641 in 2018

6. GDP $313.3 Billion or 34396.5 Billion Rupees (Nominal,2018) $1.141 Trillion (PPP, 2018) GDP Growth 5.8% (FY2018) GDP per capita $1,641 (nominal, 2018) GDP by sector Agriculture: 18.86%,Industry: 20.91%, Services: 60.23% (2018 est.)

8. Inflation (CPI) 7.0% (October 2018) Population below poverty line 29.5% Unemployment 6.0%

10. Main industries Textiles and Apparel Food processing Pharmaceuticals Construction Materials Chemicals Cement Fertilizer Mining Machinery

11. Main industries Steel Engineering Software and Hardware Automobiles Motorcycle and Auto parts Electronics Paper products Defense products Shipbuilding

12. Exports $24.772 billion (FY 2018) Export Goods Textiles ($13,343.8 million), Food ($4,793.4 million), Petroleum ($574.5 million), other manufacture ($4,116.5 million), All others ($1,391.6 million) Export Partners United States 15.6%, United Kingdom 7.1%, China 7.0%, Afghanistan 6%, United Arab Emirates 5.6%, Germany 5.5%, Bangladesh 2.9% (2018 est.)

13. Imports $55.846 billion (FY 2018) Imports Goods Machinery ($8699.8 million), Transport ($3206.4 million) Textile ($4048.9 million), Agriculture and other chemicals ($8308.5 million), Metal ($4787.9 million), Miscellaneous ($1254.3 million), All Other ($5380.4 million), Other Imports ($3303.6 million). Imports Partners China 20.5%, United Arab Emirates 15.9%, Singapore 8.0%, Saudi Arabia 5.5%, United States 3.7%, Japan 3.4%, India 3.3%(2018 est.)

14. Public debt 67.0% of GDP (June 2018) Revenues 15.2% of GDP, Pkr 5228.0 Billion or $47.6 billion(FY 2018) Expenses 21.8% of GDP, Pkr 7488.4 Billion or $68.2 billion(FY 2018)

15. Foreign Reserves SBP : $7.678 Billion Scheduled Banks : $6.389 Billion Total : $14.068 Billion (as on 2 November 2018)

16.  Pakistan was a middle class and predominantly agricultural country when it gained independence in 1947. Pakistan's average economic growth rate in the first five decades (1947–1997) has been higher than the growth rate of the world economy during the same period. Average annual real GDP growth rates were 6.8% in the 1960s, 4.8% in the 1970s, and 6.5% in the 1980s. Average annual growth fell to 4.6% in the 1990s with significantly lower growth in the second half of that decade.  The inflation rate in Pakistan averaged 7.99 percent from 1957 until 2015, reaching an all- time high of 37.81 percent in December 1973 and a record low of -10.32 percent in February 1959.

17.  Since independence the economic growth has meant an increase in average income of about 150 percent over 1950–96. But Pakistan, like many other developing countries, has not been able to narrow the gap between itself and rich industrial nations which have grown faster on a per head basis.  Per capita GNP growth rate during 1985–95 was only 1.2 percent per annum, substantially lower than India (3.2), Bangladesh (2.1), and Sri Lanka (2.6). Growth was slow during the 1950s averaging 3.1 percent per annum but accelerated to 6.7 percent during the sixties and remained generally close to 6 percent per annum till the early 1990s.

18. Gross domestic product (GDP) Industrial sector Agricultural sector Commodity producing sector growth rate Service sector Per capita income Inflation Government revenues and expenditures Current account Government debt and liabilities

19. Pakistan External Debt Servicing (Principal + Interest) Foreign exchange reserves Foreign direct investment PSE 100 index growth rate Foreign trade Workers' remittances Stock market Poverty alleviation expenditures Tourism

20. Gross domestic product (GDP) ListFY 2009FY 2010FY 2011FY 2012FY 2013FY 2014FY 2015FY 2016FY 2017FY 2018 GDP At MP (Billion Rupees) 13,199.714,867.018,276.420,046.522,385.725,168.827,443.029,075.631,962.634,396.5 US Dollars, Last Day Average Exchange Rates 81.3896 (30 Jun) 85.4634 (30 Jun) 85.9894 (30 Jun) 94.627 (30 Jun) 99.1141 (30 Jun) 98.8088 (30 Jun) 101.7895 (30 Jun) 104.7619 (30 Jun) 104.8861 (30 Jun) 109.8480 (Avg. Ann) Nominal GDP (Billion US Dollars) 162.2 174.0 212.5 211.8 225.9 254.7 269.6 277.5 304.7 313.1 GDP At BP (Billion Rupees) 8,580.08,801.49,120.39,470.39,819.110,217.110,631.611,116.811,714.112,392.6 Real GDP Growth Rate 0.36%2.58%3.62%3.84%3.68%4.05% 4.06% 4.56% 5.37% 5.79%

21. Industrial sector List2008– 2009 2009– 2010 2010– 2011 2011– 2012 2012– 2013 2013– 2014 2014– 2015 2015– 2016 2016– 2017 2017- 2018 Industrial Sector Growth Rate -5.21% 3.42% 4.51% 2.55% 0.75% 4.53% 5.18% 5.69% 5.43% 5.80% Manufacturing Sector Growth Rate -4.18% 1.37% 2.50% 2.08% 4.85% 5.65% 3.88% 3.69% 5.82% 6.24% Large Scale Manufacturing Growth Rate -6.04% 0.41% 1.66% 1.13% 4.46% 5.46% 3.28% 2.98% 5.62% 6.13% Small Scale Manufacturing Growth Rate 8.57% 8.47% 8.51% 8.35% 8.28% 8.29% 8.21% 8.19% 8.15% 8.18%

22. Agricultural sector List2008– 2009 2009– 2010 2010– 2011 2011– 2012 2012– 2013 2013– 2014 2014– 2015 2015– 2016 2016– 2017 2017- 2018 Agriculture Sector Growth Rate 3.50% 0.23% 1.96% 3.62% 2.68% 2.50% 2.13% 0.15% 2.07% 3.81% Wheat Production (Million Tons) 24.0 23.3 25.2 23.5 24.2 26.0 25.1 25.6 26.7 25.5 Rice Production (Million Tons) 6.9 4.8 6.2 5.6 6.8 7.0 6.8 7.4 Sugarcane Production (Million Tons) 50.0 49.4 55.3 58.4 63.8 67.5 62.8 65.5 73.4 82.1 Cotton Production (Million Bales) 11.8 12.9 11.5 13.6 13.0 12.8 14.0 9.9 10.7 11.9

23. Commodity producing sector growth rate List2008– 2009 2009– 2010 2010– 2011 2011– 2012 2012– 2013 2013– 2014 2014– 2015 2015– 2016 2016– 2017 2017- 2018 Commodity Producing Sector Growth Rate -0.88%1.76%3.21%3.09%1.73%3.49%3.63%2.92%3.79%4.84%

24. Service sector growth rate List2008– 2009 2009– 2010 2010– 2011 2011– 2012 2012– 2013 2013– 2014 2014– 2015 2015– 2016 2016– 2017 2017- 2018 SERVICE SECTOR GROWTH RATE 1.33% 3.21% 3.94% 4.40% 5.13% 4.46% 4.36% 5.72% 6.46% 6.43%

25. Per capita income List 2008– 2009 2009– 2010 2010– 2011 2011– 2012 2012– 2013 2013– 2014 2014– 2015 2015– 2016 2016– 2017 2017- 2018 Per Capita Income (Us Dollars) 1026.11072.41274.11320.51333.71388.81514.01530.81632.1 1640.5

26. Government revenues and expenditures ListFY 2009FY 2010FY 2011FY 2012FY 2013FY 2014FY 2015FY 2016FY 2017 FY 2018 Government Total Revenues (Billion Rupees) 1850.92077.82252.92566.52982.43637.33931.04447.04936.75228.0 Government Total Expenditures (Billion Rupees) 2531.33007.23447.33936.24816.35026.05387.85796.36800.57488.4 Fiscal Deficit (Billion Rupees) 680.4929.41194.41369.71833.91388.71456.71349.31863.82260.4

27. Current Account ListFY 2009FY 2010FY 2011FY 2012FY 2013FY 2014FY 2015FY 2016FY 2017FY 2018 Credit 35,35738,13547,70348,24350,19751,15352,92051,33651,86754,429 Debit 44,61742,08147,48952,90152,69354,28355,62956,20364,48872,559 Net -9,261-3,946 214 -4,658-2,496-3,130-2,709-4,867-12,621-18,130 Amounts in Million US Dollars

28. Pakistan External Debt Servicing ListFY 2009FY 2010FY 2011FY 2012FY 2013FY 2014FY 2015FY 2016FY 2017FY 2018 Principal (Million US $) 2837314024583294504656593499307644393335 Interest (Million US $) 11591015107410199339091172134616242293 Total (Million US $) 3996415535314312597865674671442260635628

29. Foreign trade List FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014FY 2015FY 2016FY 2017FY 2018 Exports Of Pakistan (Billion Us Dollars) 19.12119.67325.35424.71824.802 25.078 24.089 21.972 22.003 24.772 Exports Growth Rate -6.4% 2.9% 28.9%-2.6% 0.3% 1.1% -3.9% -8.8% 0.1% 12.6% Imports Of Pakistan (Billion Us Dollars) 31.74731.13235.79640.37140.157 41.668 41.357 41.255 48.683 55.846 Imports Growth Rate -10.3%-1.7%15.0%12.8%-0.5% 3.8% -0.7% -0.2% 18.0% 14.7% Trade Deficit (Billion Us Dollars) 12.62711.45210.42715.65215.355 16.590 17.267 19.283 26.680 31.074 Note : This is the merchandised trade data (export and import) as released by the SBP.This may differ from the data compiled by Pakistan Bureau of Statistics.

30. Causes of Economic Crisis in Pakistan Political Instability IMF and World Bank Energy crisis Terrorism Wealth Concentration Corruption

31. Causes of Economic Crisis in Pakistan Lack of Good Governance Unemployment Poor Health Facilities Lack of Quality Education Tax Evasion

32. Challenges to Pakistan Economy 1. We Consume More and Save Less 2. We Import More and Export Less 3. Government Spends More than it Earns as Revenues 4. Our Share in the World Trade is Shrinking 5. We Badly Lag in Social Indicators

33. Challenges to Pakistan Economy 6. We Face Energy and Water Shortages 7. Cost of Doing Business is High 8. Crisis of Governance and Implementation Weaknesses 9. Uncertainty and Unpredictability due to Lack of Continuity 10. Political In-Stability, Law and Order/Security

35. THANKS