ISLAMABAD:The Asian Development Bank (ADB) on Wednesday said Pakistan’s economic growth is expected to four percent in current Fiscal Year (FY) due to tighter fiscal and monetary policies before picking up again in the next fiscal year.
In a report issued on Wednesday, the bank said the growth is expected to accelerate to four point five percent (4.5%) in Fiscal Year 2023 due to stronger private consumption and investment. According to the Asian Development Outlook (ADO) 2022, released by the ADB on Wednesday, the developing Asia’s economies are forecast to grow 5.2% this year and 5.3% in 2023, due to a robust recovery in domestic demand and continued expansion in exports.
However, uncertainties stemming from the Russian invasion of Ukraine, the continuing coronavirus disease (COVID-19) pandemic, and tightening by the United States Federal Reserve pose risks to the outlook, the report said. It said several subregions, including South Asia and East Asia, are expected to return to the economic growth rates they experienced before the pandemic.
It said that inflation in the region remains manageable but is forecast to rise to 3.7% this year, before moderating to 3.1% in 2023. The report says that Russian invasion of Ukraine poses the most severe risk to developing Asia’s economic outlook. It says the war is already affecting economies in the region through sharp increases in prices for commodities such as oil, and has heightened instability in global financial markets.
COVID-19 continues to impact many parts of developing Asia, with some economies experiencing new surges in cases, the report maintains. It said most of developing Asia will see steady growth this year and in 2023. It said East Asia is expected to see economic growth of 4.7% this year and 4.5% in 2023.
According to the report, China, the region’s largest economy, is forecast to grow 5.0% this year and 4.8% next year, amid continued export strength. South Asian economies are expected to expand collectively by 7.0% in 2022 and 7.4% in 2023, with India – the subregion’s largest economy expected to grow 7.5% this fiscal year and 8.0% next fiscal year, the ADB report said.