Islamabad: In the first two months (July and August) of the fiscal year 2024-25, Pakistan has witnessed a decrease in inflation and an increase in the value of the rupee. Inflation has dropped from 23.4% to 9.6%, while remittances, exports, imports, and foreign investments have all shown significant growth.
The Ministry of Finance has released a report detailing the economic performance during July and August, highlighting positive developments in Pakistan’s economy. The report indicates that during these months, there has been a reduction in inflation, an increase in industrial production and exports, a decline in the current account deficit, and a strengthening of the financial sector.
The report predicts a continuation of the trend toward economic stability, expecting further improvements due to effective policies.
According to the report, exports increased by 7.2% and imports rose by 13.8%. The current account deficit saw a substantial decline of 80.9% during these two months.
Inflation decreased to 9.6% from 23.4%, and it is anticipated to remain between 8% to 9% in September and October. However, the fiscal deficit rose from PKR 225 billion to PKR 387 billion during July and August.
The report also noted a remarkable 105.6% increase in agricultural machinery imports, totaling $17.6 million. Improvements in production are expected in the coming months due to farm mechanization and modern agricultural practices.
In Kharif 2024, urea fertilizer sales saw a decrease of 13.6%, totaling 2,381 thousand tons, while DAP fertilizer sales fell by 21.9% compared to Kharif 2023. Delayed sowing of Kharif crops is likely due to climate change and the low price of wheat.
Furthermore, July 2024 recorded a 2.4% increase in Large Scale Manufacturing (LSM) production, compared to a 5.4% decline in July 2023. Positive growth was noted in 14 out of 22 sectors, including textiles, food, beverages, chemicals, and vehicles. The textile sector, in particular, accounted for 18.2% of LSM after 24 months.
During the first two months of this fiscal year, vehicle production rose by 19.5% and sales increased by 16.3%. Car production grew by 15%, while truck and bus production surged by 120.4%. However, tractor production saw a decline of 26.9%. Cement deliveries during July and August totaled 6.4 million tons.
