Investor Presentaiton
Chapter VII - Impacts of COVID-19: Fiscal Pressures and Healthcare Deficit
Response by Federal/ Provincial Government
Prime Minister Imran Khan announced huge relief package worth PKR1.2 trillion to ward off the negative impact of Coronavirus on the country.
This included the contribution of the Government for cash transfers to poor. The package also included measures to reduce prices of petroleum
products, monthly stipends for daily wagers, improving liquidity crunch for exporters and industrialists and deferment of utility bills for
households.
The Government of Pakistan, in collaboration with the Government, is trying hard to fight against the deadly disease on the one hand and
recovery from its disastrous impacts on the society on other and has taken various measures out of which following measures are targeted to
resurrect the economy:
"
The State Bank of Pakistan has deferred principal repayments of loans amounting to PKR432 billion under
its refinancing scheme to protect SMEs from the impact of Covid-19.
Rs. 432
Billion
"
A package of PKR100 billion has been provided to SMEs for payment of their utility bills and other relief
measures
ā
A relief package of PKR100 billion has been provided for exporters in the form of tax refunds and other
measures;
Rs. 100
Billion
USD 305
Million Loan
(ADB)
Rs. 50 Bn
(Small
Farmers)
ā
A USD 305 million loan finalized with the ADB of which USD 200
Million is meant for social sector and USD105 million for healthcare
infrastructure support;
The signing of an agreement between the Government of Pakistan
and the China Power Frontier Works Organization (Pakistan)
-
consortium for the construction of the Diamer Bhasha Dam including
%
do
Rs. 100
Billion
the 4500 MW hydropower plant. The project is meant to provide a short-term boost to the construction sector
in Pakistan.
The Government has announced a PKR 50 Billion support package for small farmers comprising of subsidy
on fertilizers, seeds, pesticides as well as reduction in the bank loan mark up.
Economic Outlook for Pakistan
COVID-19 has resulted in a major economic setback for Pakistan. Recovery from this setback requires a concerted effort by both Federal and
Provincial Governments. IMF predicts a U-shaped recovery for Pakistan's economy, with economic growth reaching 2% by the end of next
financial year. Following is a summary of pre & post COVID-19 economic indicators by different multilateral agenciesxiv:
Economic Indicators
FY20 (Pre-
Covid19)
IMF
FY20 (Post-
World Bank
ADB
FY20 (Post-
FY21
FY21
Covid19)
Covid19)
FY20 (Pre-
Covid19)
FY21 (Pre-
Covid19)
Real GDP Growth (%)
2.4
-1.5
2
-1.3
0.9
2.6
3.2
Inflation (%)
11.8
11.3
8
11.8
9.5
11.5
8.3
Fiscal Deficit (% of GDP)
-7.2
-9.2
-6.5
-9.5
-8.7
Exports Growth (%)
5.6
-2.1
-4.7
-19.7
-5.3
Imports Growth (%)
-8.8
-16
3
-26.3
-7.7
Remittances Growth (%)
3.4
-4.8
-1.5
-6.5
-6
Current Account Deficit (% of GDP)
-2.2
-1.7
-2.4
-1.9
-2
-2.8
-2.4
Debt (% of GDP)
84.6
89.8
87.8
90.6
91.8
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