ISLAMABAD – Predicting difficult times ahead, the World Bank revisedPakistan’s growth projections from 2 percent to 0.4 percent for the currentfiscal year, citing tighter financial conditions and limited fiscal spaceamong the primary reasons.
The bank, in its report Pakistan Development Update, warned the South Asiannation about serious dangers to its economic and debt viability projectingunexciting economic growth, with an average inflation rate of 29.5pc forthe current fiscal year.
The global financial institution maintained that poverty is likely toincrease to 37.2pc in the current fiscal year, pushing around 4 millionpeople into poverty. WB linked soaring food prices to greater foodinsecurity in Pakistan, which spends a larger share of income on food.
It maintained that implementing macroeconomic and structural reforms agreedupon under the IMF programme is critical to restoring macro-stability,confidence, and averting a public debt crisis.
World Bank Director for Pakistan Najy Benhassine said the IMF programme isan anchor to staying on course for reforms, and added that this was not aneasy time to write the Pakistan Development Update report.
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The crisis hit the nation has lost access to global capital markets, whichis now making it difficult to arrange even additional loans to revive theIMF bailout funds. The country of over 220 million is facing its worsteconomic crisis for months with an acute balance of payments crisis asnegotiations with global lender remained uncertain since last year.
On other hand, the World Bank also lowered its 2023 regional growthforecast to 5.6 percent from 6.1 percent. It lowered its forecast forIndia’s economic growth.