ISLAMABAD, April 11 (Xinhua) -- Pakistan's gross domestic product (GDP) growth is projected to recover modestly to 1.9 percent in the fiscal year 2024, starting from July 2023 to June 2024, the Asian Development Bank (ADB) said on Thursday.
This recovery from -0.2 percent in the fiscal year 2023, from July 2022 to June 2023, is expected "as economic reforms take effect and inflationary pressures ease," said the Asian Development Outlook (ADO) April 2024, the ADB's annual flagship economic publication.
Adhering to the economic adjustment program is critical to restoring macroeconomic stability and the gradual recovery of growth, the report said, adding that the downside risks to the outlook remain high.
The South Asian country's economy contracted due to the lingering impacts of the devastating floods in 2022, uncertainty and policy slippage in fiscal year 2023, weakened production, consumption, and investment.
In the ongoing fiscal year, growth will be supported by a rebound in private sector investment linked to progress on reform measures, said the ADB.
In the next fiscal year, it is projected to reach 2.8 percent, driven by higher confidence, reduced macroeconomic imbalances, greater political stability, and improved external conditions, according to the report.
"Pakistan's economy is showing signs of a gradual recovery supported by higher crop output and improvement in manufacturing," said Ye Yong, ADB country director for Pakistan.
"Growth is forecast to resume in 2024 and strengthen in 2025, but the continued implementation of policy reforms is crucial to buttressing this momentum and fortifying the country's fiscal and external buffers," Ye added. ■