960409

ADP '96-97 envisages

6.3 pc growth, 8 pc

inflation rate

NADEEM MALIK

ISLAMABAD: The Annual Development Plan (ADP) 1996-97 is being conceived with a projected GDP growth rate of 6.3 percent, rate of inflation at 8 percent and increase in indirect taxes at 16.8 percent.

Keeping in view the performance of economy over the past two years and estimated higher GDP growth rate of 6.4 percent during the current year, growth rate for 1996-97 has been forecast at 6.3 percent. The agriculture sector after an estimated growth of 6.7 percent during the current year is expected to attain a growth rate of 5.2 percent in 1996-97 of which 4.5 percent growth is expected in major crops and 8.4 percent in minor crops.

Production of Major Crops (Tons)

CROPS 1995-96 (Prov.) 1996-97 (Proj.)

Wheat 17500000 18000000

Rice 3810000 4050000

Basmati 1549000 1650000

Others 2261000 2400000

Sugarcane 47300000 48900000

Maize 1306000 1354000

Cotton (mln bales) 10.8 11.47

For the development of agriculture sector in general and the attainment of production target in particular, an input package would be ensured, comprising 2.47 million nutrient tonnes of fertilizer, 131 million acres ft. of water, 217000 tonnes of improved seeds and adequate availability of credits. In addition to this, implementation of agriculture reforms package will continue to be carried out.

Manufacturing sector is projected to grow by 7.2 percent during 1996-97 as against the estimated growth rate of 6.8 percent during 1996-97. Mining and quarrying sector is project to grow nominally by 1 percent, because no increase is expected in oil extraction as well as in the output of limestone and rock salts. Electricity and gas distribution sector is expected to maintain its high growth rate due to expected new foreign investment in this sector. The growth has, therefore, been projected at 15 percent as against 14 percent estimated in the current year. Services sector as a whole is projected to grow by 6 percent.

The total investment is projected to amount to Rs 484.1 billion or 17.8 percent higher over the current year's expected investment of Rs 411.1 billion. As a proportion of GDP the investment level is forecast to reach 19.2 percent against the last year's level of 18.7 percent. About 53.1 percent of the fixed investment is projected in the private sector. While the highest priority of the public sector could continue to be enjoyed by power, transport, communication and social sectors.

The national savings is expected to rise to 15.6 percent of GDP and would finance 81.4 percent of the total investment. The external savings is forecast to decline from 4.6 percent of GDP in 1995-96 to 3.6 percent in 1996-97.

The exports are projected to increase by 12.7 percent during 1996-97 and a benchmark of US $10.327 (cif) billion has been fixed for the next fiscal year as against the estimated exports target of US $9.16 (cif) billion during the current year. The imports have been projected to increase by 5.9 during 1996-97 and the projected target has been fixed at US $12.580 (cif) as against the estimated figure of US $11.875 billion for 1995-96.

The remittances from abroad have declined during the first half of 1995-96 to US $802 million and a target of US $1.8 billion has been fixed for 1996-97.