Peace, development, and justice are all connected to each other. We cannot talk about economic development without talking about peace. How can we expect economic development in a battlefield?
Aung San Suu Kyi
The adverse impacts of the Russia-Ukraine war are evident globally, especially on the economy. Current economic activities largely depend on the duration and intensity of the ongoing conflict. Besides the mass suffering and humanitarian calamity from the Russia-Ukraine war, the global economy is affected, resultantly in faster inflation and slower growth. The war has impacted the global economy via three channels. First, the high prices of commodities have deteriorated the real income. Second, neighboring countries along with refugees’ inflow grappled with disrupted trade. Third, business confidence is reduced due to higher investors’ uncertainty. Pakistan is not left behind by the effects of the war. It has got impacted in several ways. After making a remarkable recovery from the Covid-19 pandemic in 2021, many economies of the world are heading towards an awkward continuous situation in which prices are rising and growth rates are falling. During Imran Khan’s government, the economic growth rate of Pakistan, fueled by imports and consumption, accelerated to 6 percent. That was the highest rate in four years. That ratio helped in incrementing the nation’s economy to $383 billion. Gross Domestic Product (GDP) is the country’s monetary value of all the produced goods and services in a year. In the year 2021-2022, the provisional GDP growth rate was estimated at around 5.97 percent. No doubt, there has been broad-based growth in all the economic sectors of Pakistan. The 6 percent growth rate is higher compared to the official target of 4.8 per cent. It is far higher than the estimated figures of the State Bank of Pakistan, Ministry of Finance, World Bank, Asian Development Bank, and the IMF. The economic growth rate of Pakistan during the PTI’s government was much better than during the PML-N’s era. According to the International Monetary Fund (IMF)’s World Economic Outlook, April 2022, global economic growth is likely to recede to 3.6 percent in 2022, as well as in 2023, from 6.1 percent in 2021. Recently, the import of all non-essential luxury goods that are not used by a majority, has been banned by the Pakistani government to stabilize the economic situation of the country. This move is taken due to the uncontrollable current account deficit and the devaluation of the local currency. The growth of Pakistan’s economy is projected to slow down to 4% in 2022 from 5.6% in 2021 before registering a slight uptick at 4.2% in 2023. We are going to see economic disruption in the near future if things do not control by the implementation of effective policies by the concerned authorities. Pakistan’s geographical location makes it essential for the entire world. We have an opportunity to trade all around the world by land, sea, and air. Economic prosperity can be achieved by increasing exports and decreasing imports.
