ISLAMABAD: The government has understated the growth rate by 1.5 percent for fiscal year 2019-20, which enabled them to claim 3.94 percent growth projection for fiscal year 2020-21.

This was stated by Former Finance Minister Dr Hafeez Pasha while taking to Business Recorder. Further elaborating his claim, Pasha said that base for 2019-20 was as per calculations negative 2 percent instead of the government claim of negative 0.4 percent, therefore projection for the ongoing fiscal year can be downgraded to 1.5 percentage points.

Former Adviser Finance Ministry Dr Ashfaque Hasan Khan stated that the low-base for 2019-20 was the reason for the 4 percent growth rate projection for the current fiscal year and therefore this number should not be taken seriously.

He further stated that he estimates the growth rate for the current year to be even higher than 3.94 percent simply because of the expected higher Large Scale Manufacturing (LSM) growth in the last quarter of the current fiscal year (April-June 2021).

Dr Ashfaque Hassan Khan added that as the LSM base during the last quarter of the previous year (April to June 2020) was very low, therefore, the LSM growth owing to this low base would be around 13-14 percent for the comparable period of the current fiscal year when data is routinely revised/updated for the previous year by the Ministry of Planning. This would imply, he added, that GDP projection for 2020-21 would have to be revised upward to 4.7 to 5 percent.

Copyright Business Recorder, 2021