Before the coronavirus pandemic, Prime Minister Imran Khan represented Pakistan on the world economic forum. On the world economic forum 2020, Imran khan stated that Pakistan is on the path to economic growth therefore, will not cause any conflicts and practice stability and peace which are vital for prosperity of the country.
Moreover, the economic survey of Pakistan 2019-20 showed similar trends that Pakistan in world economic forum 2020 did. However, when the coronavirus pandemic hit Pakistan in March, the impact of covid-19 on Pakistan and what was declared on the world economic forum 2020 contradicted each other.
Pakistan is among those countries which have a fragile economy. However, in recent years, it was moving towards stability until the coronavirus pandemic hit the world and brought down various large economies down.
Moreover, experts fear that the coronavirus pandemic would derail the country’s recovery process due to economic fallout. Hence, can be said that the coronavirus impact on Pakistan is highly devastating and its effect would be prolonged.
Till now, Pakistan has around 270,000 registered cases of coronavirus and more than 5,700 deaths. Last week, President Arif Alvi congratulated the whole nation by saying that this is a victory for our country against the Coronavirus as the government was successful enough to save the poorest and less fortunate from the impact of the pandemic.
Although, the covid-19 impact on Pakistan economy has devastating blow as its economy is shrinking, several sectors are in crisis and the unemployment rate is rising in the country.
In addition, Pakistan’s exports are declining especially of textile products since the coronavirus pandemic started as some orders are being cancelled as well.
As a result, the foreign reserves are badly affected along with the depreciation of Pakistani currency.
When Imran Khan came to power in 2018, the GDP of Pakistan was around 5.8% which declined to 0.98%, it is expected to further decline. Furthermore, the fiscal deficit of Pakistan is about 10% and the revenue generated has plummeted in the past two years.
The situation of Pakistan’s economy can be further explained as follows:
The onset of Coronavirus pandemic overstretched the public health system of Pakistan and also, the coronavirus impact on environment in Pakistan was not disastrous.
According to UNDP, on average in Pakistan, one doctor was appointed for every 963 citizens for a single bed for all of the 1,608 people.
Hence, Pakistan faced a shortage of 200,000 doctors with a population of 1.4 million nurses to cope up with the crisis.
Khurram Shehzad, the risk analyst and investment banker expected that the economy of Pakistan would shrink by $15 Billion due to the coronavirus pandemic.
Subsequently, he also predicted that a decline of 10% in the GDP (Gross Domestic Product) would be experienced in the fourth quarter of the financial year 2020.
During the month of June, the federal government of Pakistan unveiled the economic recovery plan of 1.3 trillion rupees.
Furthermore, Islamabad announced the support funds for various businesses which would consist of 100 Billion rupees in tax funds and an additional 100 billion rupees in the form of deferred interest payments.
Concluding this, it can be observed that the economy of Pakistan is badly affected by the Coronavirus pandemic. Considering the limited financial capacity that Pakistan acquired, the costs of pandemic would be difficult to bear.
Experts warn that Pakistan might require financial assistance for World Bank and IMF along with allies like Saudia Arabia and China to recover its economy.
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