Return to growth trajectory

[sparten]

One of the lessons of Financial crises is that large countries (in terms of population) don't necessarily deserve to be seen in the same way as smaller niche countries. The reason is that internal demand is huge. Falling exports is a worry, yet in a time of falling exports, we are seeing industrial output soar. Electronics, cement, automotive and pharma and textiles are experiencing unprecedented demands.

Textiles is an interesting thing, its booming, because they are making more money selling internally than they did selling overseas. Many large concerns have shifted to relying on domestic consumers as opposed to foreign buyers (who are unreliable). So while the reduction in exports on face of it makes alarming reading, its not the whole story.

Another problem is that some our largest industries are not (yet) selling overseas. Electronics, consumer goods, pharma, cement are huge parts of our economy and yet (except for pharam) we have minimal presence overseas.

 

[Hakikat ve Hikmet]

One of the lessons of Financial crises is that large countries (in terms of population) don't necessarily deserve to be seen in the same way as smaller niche countries. The reason is that internal demand is huge. Falling exports is a worry, yet in a time of falling exports, we are seeing industrial output soar. Electronics, cement, automotive and pharma and textiles are experiencing unprecedented demands.

Textiles is an interesting thing, its booming, because they are making more money selling internally than they did selling overseas. Many large concerns have shifted to relying on domestic consumers as opposed to foreign buyers (who are unreliable). So while the reduction in exports on face of it makes alarming reading, its not the whole story.

Another problem is that some our largest industries are not (yet) selling overseas. Electronics, consumer goods, pharma, cement are huge parts of our economy and yet (except for pharam) we have minimal presence overseas.

Based on the Turkish experience, I may put that your total economy is ~2X of your official economy. I believe, like Turkey, Pak has a large Esnaf (self employed small traders, producers etc.) class. Their real income is mostly unreported, and they do barters. Moreover, they have access to foreign currencies, goods, raw materials, etc. - everything in unofficial channels. They take care of each other and support extended families. They are practical and clever in business deals, and quick in changing business models. And, they enjoy a Bereket factor - discussion of which is beyond the scope of this forum. The current Muslim leadership in Turkey is from this Esnaf class. Thanks to the Muslim leaders, the previous Esnaf folks now own large industries, corporations, construction companies, banks, etc. and have become exporters. Challenge is to document their economic activities..

 

[MadDog]

Based on the Turkish experience, I may put that your total economy is ~2X of your official economy. I believe, like Turkey, Pak has a large Esnaf (self employed small traders, producers etc.) class. Their real income is mostly unreported, and they do barters. Moreover, they have access to foreign currencies, goods, raw materials, etc. - everything in unofficial channels. They take care of each other and support extended families. They are practical and clever in business deals, and quick in changing business models. And, they enjoy a Bereket factor - discussion of which is beyond the scope of this forum. The current Muslim leadership in Turkey is from this Esnaf class. Thanks to the Muslim leaders, the previous Esnaf folks now own large industries, corporations, construction companies, banks, etc. and have become exporters. Challenge is to document their economic activities..

Yes a large part of the economy goes unreported, InshAllah the economy size will quadriple in the coming years with CPEC coming into realization. I wish Pakistan, Turkey and Iran could do something about ECO, in Raza Shah Pahlevi's time, it was an active project in the form of RCD. Now the representatives from the three countries meet and no one focuses on it. That corridor can also be a game changer for the whole region, connecting Turkey with Pakistan via Iran. As far as I know, a cargo train went from Islamabad to Istanbul via Tehran. But never heard anything after that. It was called Gul Train. https://en.wikipedia.org/wiki/Gül_Train

 

[Gibbs]

It would be interesting to see where Pakistan measures in this interesting chart released by the Economist recently:

http://www.economist.com/blogs/graphicdetail/2016/05/daily-chart-2?fsrc=scn/tw/te/bl/ed/comparingcronycapitalismaroundtheworld&?fsrc=scn/=tw/dc

Whoa.. Look at Singapore.. Who knew ? The perennial Asian capitalist utopia, where rule of law, Free enterprise and good governance is said to be ruling.. Lol

 

[ajpirzada]

lol couldnt be more optimistic.

this year's PSDP has been reduced to 580bn from 700bn. And out of the 580bn only 500bn has been released so far according to the news from last month. And the article is dreaming that next year's PSDP will jump to 800bn?

And a tax-to-GDP ratio will increase to 12.5%? wow. Typical budgetary error which has been made almost every year. Government overestimates the tax revenue by approx 200bn and then is forced to cut the PSDP by the same amount when the tax target is missed.

 

[Cyberian]

The size of the economy (GDP at current market price) has been projected to increase from Rs30.672tr to Rs34.801tr in 2016-17 and further to Rs40tr in 2017-18. @Nilgiri

So the government is projecting a $203 billion nominal GDP for 2016/2017 and then $230 billion Nominal GDP for 2017/2018 when it was $270 billion in 2015 according to IMF's April 2016 report?

How is that progress?