Budget 2016-17

Budget 2016-17 can be called as “Mixed budget” because of the widespread contradictions in progress among different sectors of the economy. One sector of the economy is showing astonishing progress while another one is falling well below its target growth. Thus we can show two different views or sides of the said budget.

Brighter side:

From the point of view of Government, it was a success story all over and they try to persuade critics and public with some facts and figures. First one is the GDP ( Gross domestic product)  growth rate of 4.7% which is not quite high but is much better than what we saw in last few years and especially compared to GDP growth rate during Zardari era.

 Other positive indicators include the growth of Industrial sector which showed an increase of 6.8% which is a miracle in itself. Inflation stood at 2.8% which is the lowest in the decade. Foreign remittances which were showing precarious low indices of 11.6 Billion during 2012-13 budget have now been increased to more than 16 Billion.

The fiscal deficit which was more than 8% has now reduced to almost 4%. Per capita income which was standing at 1334$ during 2012-13 has now increased up to 1561$ showing an increase of 21%. Tax to GDP ratio has also improved from 8.5% to 10.5%, tax provides a strong base for the economy but Pakistani economy was and is still missing this important link. The services sector has been phenomenal showing an improvement of 5.7% being highest since 2007.

Pakistan’s stock exchange has been classified as emerging stock market by MSCI (Morgan Stanley Capital International) and is now identified as one of the few stock markets which are dominating Asia market. Moody has also ranked Pakistan as better performing economies.

Darker side:

The above figures showed improvements in the economy and are been highly praised by those on Government benches.  However, the opposition has criticised Budget because of the figures that show a bleaker side of Budget.  Exports were recorded at 20.5 billion dollars during 2012-13 have decreased to a miserable figure of 18.2$ showing a high decline of more than 11% which can be attributed to the reduction of commodities price globally. Agriculture sector which is the backbone of our economy and almost 70% population gets income from, is in very poor condition, showing a shrinkage of 0.19%.

Net foreign investment is on the lowest side during four years and standing at a figure of 1 Billion dollars showing a grim picture of foreign investment in our economy. Current government’s focus lies in Metro buses, bridges, and roads not giving a chance to invest money on more important sectors such as health, education, water and basic needs of life.  The promise shown by the construction industry was once attributed to the Telecom sector but now due to heavy taxes, the Telecom sector is not performing that well.

These are some of the factors that show the state of an economy, though these figures are much below than our national capacity yet we can say that economy is improving compared to previous years.