Goldman Sachs Projects Pakistan Economy to Become the World's 6th Largest by 2075

Goldman Sachs analysts Kevin Daly and  Tadas Gedminas project Pakistan's economy to grow to become the world's sixth largest by 2075.  In a research paper titled "The Path to 2075", the authors forecast Pakistan's GDP to rise to $12.7 trillion with per capita income of $27,100.  India’s GDP in 2075 is projected at $52.5 trillion and per capita GDP at $31,300.  Bangladesh is projected to be a $6.3 trillion economy with per capita income of $31,000.  By 2075, China will be the top global economy, followed by India 2nd, US 3rd, Indonesia 4th, Nigeria 5th and Pakistan 6th. The forecast is based primarily on changes in the size of working age populations over the next 50 years.  

GDP Ranking Changes Till 2075. Source: Goldman Sachs Investment Research 

Economic Growth Rate Till 2075. Source: Goldman Sachs Investment Research 

Economic Impact of Slower Population Growth: 

Daly and Gedminas argue that slowing population growth in the developed world is causing their economic growth to decelerate. At the same time, the economies of the developing countries are driven by their rising populations.  Here are four key points made in the report:

 1) Slower global potential growth, led by weaker population growth. 

2) EM convergence remains intact, led by Asia’s powerhouses. Although real GDP growth has slowed in both developed and emerging economies, in relative terms EM growth continues to outstrip DM growth.

3) A decade of US exceptionalism that is unlikely to be repeated. 

4) Less global inequality, more local inequality. 

Goldman Sachs' Revised GDP Projections. Source: The Path to 2075

Demographic Dividend: 

With rapidly aging populations and declining number of working age people in North America, Europe and East Asia, the demand for workers will increasingly be met by major labor exporting nations like Bangladesh, China, India, Mexico, Pakistan, Russia and Vietnam. Among these nations, Pakistan is the only major labor exporting country where the working age population is still rising faster than the birth rate. 

Pakistan Population Youngest Among Major Asian Nations. Source: Nikkei Asia

World Population 2022. Source: Visual Capitalist

World Population 2050. Source: Visual Capitalist

Over 10 million Pakistanis are currently working/living overseas, according to the Bureau of Emigration. Before the COVID19 pandemic hit in 2020,  more than 600,000 Pakistanis left the country to work overseas in 2019. Nearly 700,000 Pakistanis have already migrated in this calendar year as of October, 2022. The average yearly outflow of Pakistani workers to OECD countries (mainly UK and US) and the Middle East was over half a million in the last decade. 

Consumer Markets in 2030. Source: WEF

World's 7th Largest Consumer Market:

Pakistan's share of the working age population (15-64 years) is growing as the country's birth rate declines, a phenomenon called demographic dividend. With its rising population of this working age group, Pakistan is projected by the World Economic Forum to become the world's 7th largest consumer market by 2030. Nearly 60 million Pakistanis will join the consumer class (consumers spending more than $11 per day) to raise the country's consumer market rank from 15 to 7  by 2030. WEF forecasts the world's top 10 consumer markets of 2030 to be as follows: China, India, the United States, Indonesia, Russia, Brazil, Pakistan, Japan, Egypt and Mexico.  Global investors chasing bigger returns will almost certainly shift more of their attention and money to the biggest movers among the top 10 consumer markets, including Pakistan.  Already, the year 2021 has been a banner year for investments in Pakistani technology startups

Record Remittances From Overseas Pakistanis:

Pakistan is already seeing high levels of labor export and record remittances of over $30 billion pouring into the country. Saudi Arabia and the United Arab Emirates(UAE) are the top two sources of remittances but the biggest increase (58%) in remittances is seen this year from Pakistanis in the next two sources: the United Kingdom and the United States.

Remittances from the European Union (EU) to Pakistan soared 49.7% in FY 21 and 28.3% in FY22, according to the State Bank of Pakistan. With $2.5 billion remittances in the first 9 months (July-March) of the current fiscal year, the EU ($2.5 billion) has now surpassed North America ($2.2 billion) to become the third largest source of inflows to Pakistan after the Middle East and the United Kingdom. Remittances from the US have grown 21%, second fastest after the EU (28.3%) in the first 9  months of the current fiscal year. 

Pakistan ranks 6th among the top worker remittance recipient countries in the world.  India and China rank first and second, followed by Mexico 3rd, the Philippines 4th, Egypt 5th and Pakistan 6th.  

Pakistan Demographics

About two million Pakistanis are entering the workforce every year. The share of the working age population in Pakistan is increasing while the birth rate is declining. This phenomenon, known as demographic dividend, is coinciding with declines in working age populations in developed countries. It is creating an opportunity for over half a million Pakistani workers to migrate and work overseas, and send home record remittances. 


Riaz Haq said…
In last 65 years (1952-2018), #Pakistan's #GDP growth rate has averaged 4.92%, reaching an all time high of 10.22% in 1954 & a record low of -1.80% in 1952. If Pakistan continues to average 4.92% over the next 53 years until 2075, it will be $4.9 trillion GDP in today's dollars

$1 in 2021 is equivalent in purchasing power to about $5.27 in 2075, an increase of $4.27 over 54 years. The dollar had an average inflation rate of 3.13% per year between 2021 and 2075, producing a cumulative price increase of 426.85%. The buying power of $1 in 2021 is predicted to be equivalent to $5.27 in 2075.


Multiplying $4.9 trillion in today's dollars by 5.27 gives us $25.8 trillion in 2075 dollars.
Riaz Haq said…
Saudis to aid Pakistan, deals eyed in Egypt, Turkey

Saudi Arabia plans to provide Pakistan with financial support, Saudi Minister of Finance Mohammed al-Jadaan said, as the kingdom looks to help shore up alliances with countries struggling with the effects of rising inflation.

The Saudi Arabian government is to “continue to support Pakistan as much as we can,” al-Jadaan said at a news conference in Riyadh.

The kingdom has taken several steps to provide financial support to countries in the region as it looks to bolster allies and cement new relationships.

Earlier this month, it extended the term of a US$3 billion deposit to boost foreign currency reserves and help Pakistan overcome economic repercussions of the COVID-19 pandemic.

Saudi Arabia is also looking to make more investments in Egypt and is planning to initiate deals in Turkey, al-Jadaan said.

“Our relationship with Turkey is improving greatly, and we hope to have investment opportunities,” he said. “We have started investing aggressively in Egypt and we will continue to look at investment opportunities and that is more important than deposits. Deposits can be pulled, but investments stay.”

Saudi Arabia is in the final stages of agreeing to deposit US$5 billion at Turkey’s central bank, the finance ministry said last month, a major boost for Turkish President Recep Tayyip Erdogan’s bid to keep the country’s currency stable ahead of presidential elections next year.

The agreement would crown a recent rapprochement that ended years of hostility between the Turkish and Saudi Arabian governments.

It also extended the maturity of a US$5 billion deposit with Egypt’s central bank last month, and the kingdom’s Public Investment Fund is also looking into US$10 billion of potential investments in Egypt’s healthcare, education, agriculture and financial sectors, the Egyptian Cabinet said in a statement.

The momentum of talks between the countries’ central banks comes after a joint effort by Saudia Arabia and Turkey to mend ties that were ruptured after the murder of Saudi Arabian journalist Jamal Khashoggi in 2018 at the kingdom’s Istanbul consulate.
Riaz Haq said…
Path to 2075

First, there is a large gap between the largest three economies (China, India and the US) and all other economies (although the Euro area represents a fourth economic
superpower, if it is treated as a single economy). Thus, although Indonesia, Nigeria
and Pakistan are projected to be fourth, fifth, and sixth in the 2075 GDP rankings each of them are projected to be less that one-third of the size of China, India and
the US.

Second, while China and India are projected to be larger than the US by 2075, our
projections imply that the US will remain more than twice as rich as both (and five
times as rich as countries such as Nigeria and Pakistan).

Pakistan Economic Growth


2000-2009 4.7%

2009-2019 4.0


2019-2029 5.0

2024-2029 6.0

2030-2039 5.9

2040-2049 5.3

2050-2059 4.7

2060-2069 4.0

2070-2079 3.4

Pakistan GDP in Trillion US$

2000 0.1

2010 0.2

2020 0.3

2030 0.6

2040 1.6

2050 3.3

2060 6.1

2070 9.9

2075 12.3
Riaz Haq said…
Path to 2075

Pakistan Per Capita Income in thousands of 2021 US$

2000 0.9

2010 1.3

2020 1.4

2030 2.2

2040 4.8

2050 9.0

2060 14.9

2070 22.5

2075 27.1
Riaz Haq said…
The Path to 2075

Country GDP % Growth Rate by decades 2000-2009 to 2070-2079

Pakistan 4.7 4.0 5.0 6.0 5.9 5.3 4.7 4.0 3.4

China 10.3 7.7 4.2 4.0 2.5 1.6 1.1 0.9 0.5

India 6.9 6.9 5.0 5.8 4.6 3.7 3.1 2.5 2.1

Korea 4.9 3.3 2.0 1.9 1.4 0.8 0.3 -0.1 -0.2

Bangladesh 5.6 6.6 6.3 6.6 4.9 3.8 3.0 2.5 2.0


Country GDP in Trillions of U$ from 2000 to 2075

Pakistan 0.1 0.2 0.3 0.6 1.6 3.3 6.1 9.9 12.3

China 1.8 7.4 15.5 24.5 34.1 41.9 48.6 54.8 57.0

India 0.7 2.1 2.8 6.6 13.2 22.2 33.2 45.8 52.5

Korea 0.9 1.4 1.7 2.0 2.6 3.1 3.3 3.4 3.4

Bangladesh 0.1 0.2 0.4 0.8 1.7 2.8 4.1 5.5 6.3


Country Per Capita Income in thousands of US$ by Decade-ends 2000 to 2075

Pakistan 0.9 1.3 1.4 2.2 4.8 9.0 14.9 22.5 27.1

China 1.4 5.5 10.9 17.3 24.7 31.9 40.3 50.4 55.4

India 0.7 1.7 2.0 4.3 8.2 13.3 19.6 27.1 31.3

Korea 18.7 28.8 33.0 39.3 53.6 67.7 81.8 95.2 101.8

Bangladesh 0.7 1.1 2.3 4.4 8.4 13.5 19.7 26.9 31.0
Riaz Haq said…
#Pakistan's top court endorses #Canadian mining giant Barrick Gold's $10 billion #investment at Reko Diq in #Balochistan. It is one of the world's largest underdeveloped sites of #copper and #gold deposits.

Pakistan's Supreme Court endorsed on Friday a settlement for Barrick Gold (ABX.TO) to resume mining at the Reko Diq project, one of the world's largest underdeveloped sites of copper and gold deposits, it said in an order.

The endorsement was a condition of the settlement for Barrick to resume work on the project in the southwestern province of Balochistan, bordering Afghanistan and Iran, in which it will invest $10 billion.

Chief Justice Umar Ata Bandial, the head of a five-judge panel, read out the operative part of the brief order in court.

"The agreements ... have not been found by us to be unconstitutional or illegal on the parameters and grounds spelt out," read the order seen by Reuters.

President Arif Alvi had asked the court to review the deal.

In an out of court agreement this year, Barrick Gold ended a long-running dispute with Pakistan, and agreed to restart development.

Under the deal, the company withdrew its case in an international arbitration court, which had slapped a penalty of $11 billion on Pakistan for suspending the contracts of the company and its partners in 2011.

The company's licence to mine the untapped deposits was cancelled after the Supreme Court ruled illegal the award granted to it and its partner, Chile's Antofagasta (ANTO.L).

Antofagasta had agreed to exit the project, saying its growth strategy was focused on production of copper and by-products in the Americas.

Pakistan's mineral-rich province of Balochistan is home to both Islamist militants and separatist Baloch insurgents, who have engaged in insurgency against the government for decades, demanding a greater share of the region's resources.

Riaz Haq said…
The Path to 2075

Country GDP % Growth Rate by decades 2000-2009 to 2070-2079

United States 1.9 2.3 1.7 1.9 1.7 1.5 1.4 1.3 1.2

Germany 0.8 2.0 0.7 1.2 1.3 1.1 0.9 0.9 1.0

France 1.5 1.4 1.2 1.7 1.5 1.3 1.2 1.2 1.1

Italy 0.5 0.3 0.9 1.4 1.0 0.7 0.6 0.5 0.5

Japan 0.5 1.2 0.6 0.9 0.8 0.7 0.7 0.6 0.5

United Kingdom 1.6 2.0 1.4 2.0 1.9 1.6 1.5 1.3 1.2

Australia 3.1 2.6 2.3 2.5 2.4 2.1 1.8 1.7 1.5

Canada 2.1 2.3 1.7 2.1 2.0 1.9 1.7 1.6 1.6

Indonesia 5.3 5.4 3.8 4.3 3.6 3.0 2.6 2.3 2.0

Thailand 4.3 3.6 1.9 2.8 2.4 1.9 1.4 1.1 0.9

Philippines 4.5 6.4 4.4 6.0 4.9 4.1 3.5 3.1 2.7

Malaysia 4.7 5.4 2.9 3.6 3.5 2.9 2.2 1.8 1.5

Russia 5.5 2.1 0.3 1.2 1.6 1.2 1.2 1.3 1.1

Turkey 4.0 5.9 4.2 3.5 2.9 2.1 1.7 1.4 1.1

Kazakhstan 8.6 4.4 2.7 3.1 3.2 2.8 2.8 2.8 2.5

South Africa 3.6 1.7 1.8 2.8 3.6 3.4 2.9 2.6 2.2

Nigeria 8.3 3.8 3.6 4.6 6.3 6.1 5.4 4.6 3.9

Ghana 5.3 6.7 4.3 5.0 5.2 4.9 4.5 4.1 3.6

Ethiopia 8.6 9.6 8.6 10.7 8.2 6.6 5.5 4.7 4.0


Country GDP in Trillions of U$ from 2000 to 2075

United States 15.6 18.5 21.8 27.0 32.0 37.2 42.8 48.6 51.5

Germany 3.0 4.2 4.0 4.4 5.3 6.2 6.9 7.7 8.1

France 2.1 3.3 2.7 3.2 3.9 4.6 5.4 6.1 6.5

Italy 1.7 2.6 2.0 2.3 2.7 3.1 3.4 3.6 3.8

Japan 7.5 7.1 5.2 4.4 5.2 6.0 6.7 7.2 7.5

United Kingdom 2.5 3.1 2.9 3.3 4.3 5.2 6.1 7.1 7.6

Australia 0.6 1.5 1.4 1.8 2.3 2.8 3.3 3.9 4.3

Canada 1.1 2.0 1.7 2.3 2.8 3.4 4.1 4.8 5.2

Indonesia 0.3 0.9 1.1 2.2 4.0 6.3 9.0 12.1 13.7

Thailand 0.2 0.4 0.5 0.7 1.2 1.7 2.2 2.6 2.8

Philippines 0.1 0.3 0.4 0.7 1.4 2.5 3.9 5.6 6.6

Malaysia 0.2 0.3 0.4 0.6 1.2 1.8 2.5 3.2 3.5

Russia 0.4 2.0 1.5 2.8 3.7 4.5 5.4 6.4 6.9

Turkey 0.4 1.0 0.8 1.3 2.2 3.1 4.0 4.8 5.2

Kazakhstan 0.0 0.2 0.2 0.3 0.6 0.9 1.3 1.8 2.1

Egypt 0.2 0.3 0.4 0.8 1.9 3.5 5.8 8.8 10.4

Saudi Arabia 0.3 0.7 0.7 1.5 2.4 3.5 4.5 5.6 6.1

Pakistan 0.1 0.2 0.3 0.6 1.6 3.3 6.1 9.9 12.3

South Africa 0.2 0.5 0.4 0.5 0.9 1.4 2.1 2.8 3.3

Nigeria 0.1 0.5 0.4 0.8 1.6 3.4 6.2 10.4 13.1

Ghana 0.0 0.1 0.1 0.1 0.3 0.5 0.8 1.2 1.5

Ethiopia 0.0 0.0 0.1 0.3 0.7 1.6 2.9 4.9 6.2


Country Per Capita Income in thousands of US$ by Decade-ends 2000 to 2075

United States 55.1 59.5 64.8 76.7 87.3 99.2 112.3 125.5 132.2

Germany 36.3 51.5 48.6 53.2 65.9 78.6 90.7 104.2 111.6

France 35.3 52.2 42.6 48.3 59.2 70.5 82.9 96.1 102.8

Italy 30.6 44.0 33.1 39.6 49.6 59.2 70.2 82.2 88.0

Japan 59.4 55.3 41.8 36.8 47.0 57.5 68.9 81.2 87.6

United Kingdom 42.9 48.9 42.9 47.9 60.2 72.5 85.7 99.8 106.6

Australia 31.9 70.1 55.1 64.4 75.1 86.7 98.8 112.3 119.4

Canada 36.8 58.6 45.2 56.4 64.7 74.5 85.4 97.0 103.1

Indonesia 1.3 3.8 4.1 7.5 12.9 19.8 28.2 38.0 43.4

Thailand 3.0 6.1 7.3 10.1 17.0 25.0 34.0 44.0 49.3

Philippines 1.6 2.7 3.4 5.5 9.9 15.7 23.1 32.1 37.3

Malaysia 6.8 11.1 10.6 17.0 29.5 44.2 59.2 75.1 83.5

Russia 2.9 14.0 10.6 19.9 27.2 34.1 42.1 52.1 57.2

Turkey 6.5 13.1 8.9 14.3 23.2 32.1 41.3 51.5 56.7

Kazakhstan 1.8 11.0 9.4 16.1 25.5 35.4 47.4 62.5 70.5

Egypt 2.2 3.2 3.7 6.3 12.9 22.0 33.5 47.1 54.6

Saudi Arabia 13.3 22.1 20.4 36.1 54.2 71.9 90.2 110.5 120.6

Pakistan 0.9 1.3 1.4 2.2 4.8 9.0 14.9 22.5 27.1

South Africa 4.9 9.9 6.0 8.0 12.9 19.3 27.3 37.2 42.6

Nigeria 0.8 2.8 2.1 2.9 5.1 8.9 14.4 22.0 26.5

Ghana 0.9 2.1 2.3 3.3 5.5 8.7 13.2 19.4 23.1

Ethiopia 0.2 0.4 0.9 1.9 4.0 7.3 11.8 18.1 21.9
Majumdar said…
Brof sb,

How come BD is not appearing in the list of 15 top economies in 2075, considering that it is already ahead of PAK currently?

Riaz Haq said…
Majumdar: "How come BD is not appearing in the list of 15 top economies in 2075, considering that it is already ahead of PAK currently?"

A major factor in Goldman Sachs 2075 forecast is the change in working age population between now and 2075. The GDP of countries like Nigeria and Pakistan with rising working age populations will grow faster. That's also the reason why countries in Europe and East Asia will see slower growth.

GS forecasts Bangladesh economy to be about $6.3 trillion with per capita income of $31,000 in 2075.

The projected size of BD economy ($6.3 trillion) is about half of Pakistan's ($12.7 trillion) but BD will have higher per capita income ($31,000) than Pakistan's ($27,100).
Riaz Haq said…
The Path to 2075

The 10 years following the creation of the BRICs acronym in 2001 represented a golden
era for emerging market economic and financial market outperformance. Between the
early 2000s and the 2007/08 Global Financial Crisis (GFC), growth was unusually strong
in most economies and especially so in EMs, fuelled by exceptionally rapid globalisation.
And, while the Global Financial Crisis drove developed economies into a deep and
lengthy recession, the majority of EMs weathered that storm relatively well. For most
economies and in most respects, our first set of BRICs projections underestimated the
speed of EM convergence over the subsequent 10 years.
The same was not true for the 10 years after that. In Exhibit 7 we compare actual GDP
growth for the period 2010-2019 with our 2011 projections.4
GDP growth has undershot
our 2011 estimates by an average of 0.6 percentage points per year (based on a
PPP-weighted average). The most notable underperformers have been Russia, Brazil,
and Latin America more generally. That said, the cross-country performance has been
mixed, with the world’s two largest economies – the US and China – matching our
projections and India slightly surpassing them.

Country GDP % Growth Rate by decades 2000-2009 to 2070-2079

Brazil 3.4 1.4 1.9 2.4 2.8 2.5 2.1 1.7 1.5

Mexico 1.5 2.7 1.8 3.0 3.0 2.6 2.2 1.7 1.4

Argentina 2.6 1.4 2.6 3.3 3.1 2.6 2.2 1.8 1.5

Colombia 3.9 3.7 3.4 3.4 3.3 2.7 2.2 1.7 1.4

Chile 4.2 3.3 2.1 2.3 2.4 2.0 1.6 1.4 1.2

Peru 5.0 4.5 3.3 4.2 4.0 3.5 2.9 2.5 2.1


Country Per Capita Income in thousands of US$ by Decade-ends 2000 to 2075

Brazil 5.7 13.8 7.1 10.4 15.3 21.3 28.3 36.3 40.8

Mexico 11.0 11.6 9.0 14.3 21.2 29.5 39.2 50.0 55.7

Argentina 13.0 12.7 9.0 15.2 20.9 27.2 34.5 42.5 46.7

Colombia 3.8 7.9 5.5 9.8 16.4 24.4 33.3 43.1 48.5

Chile 7.7 15.7 13.6 18.3 26.2 35.0 44.0 54.2 59.8

Ecuador 2.2 5.7 5.9 7.8 11.2 15.5 21.0 27.6 31.4

Peru 2.9 6.3 6.4 9.8 15.5 22.7 31.1 41.0 46.5


Country GDP in Trillions of U$ from 2000 to 2075

Brazil 1.0 2.7 1.5 2.3 3.5 4.9 6.4 8.0 8.7

Mexico 1.1 1.3 1.1 1.9 3.0 4.2 5.6 6.9 7.6

Argentina 0.5 0.5 0.4 0.7 1.0 1.4 1.8 2.2 2.4

Colombia 0.2 0.4 0.3 0.5 0.9 1.4 1.9 2.4 2.6

Chile 0.1 0.3 0.3 0.4 0.5 0.7 0.9 1.1 1.2

Ecuador 0.0 0.1 0.1 0.2 0.2 0.3 0.5 0.6 0.7

Peru 0.1 0.2 0.2 0.4 0.6 1.0 1.4 1.8 2.1
Mo said…
well lets see if Sharif and Zardari clan is still in Pakistan by 2075.

Riaz Haq said…
Mo: "well lets see if Sharif and Zardari clan is still in Pakistan by 2075"

There's a lot more to Pakistan than Sharif and Zardari. Pakistan will do well in spite of its self-serving politicians
Porus said…
Such forecasts are just wishful thinking.
Riaz Haq said…
Porus: "Such forecasts are just wishful thinking"

All forecasts, including this one, are based on certain assumptions.

In this case, it's the working age population that drives economic growth.
Riaz Haq said…
Japan Needs Indian Tech Workers. But Do They Need Japan?
Recruiters call the push a crucial test of whether the world’s third-largest economy can compete with the U.S. and Europe for global talent.

Mr. Puranik said fellow Indians often called him for help with emergencies or conflicts — the wandering father with dementia who ends up in police custody, the daughter mistakenly stopped by border agents at the airport. He once even fielded a call from a worker who wanted to sue his Japanese boss for kicking him.

His own son, he said, was bullied in a Japanese school — by the teacher. Mr. Puranik said he repeatedly talked to the teacher, to no avail. “She would always try to make him a criminal,” he said, adding that some teachers “feel challenged if the kid is doing anything differently.”

A similar dynamic can sometimes be found in the workplace.

Many Indian tech workers in Japan say they encounter ironclad corporate hierarchies and resistance to change, a paradox in an industry that thrives on innovation and risk-taking.

“They want things in a particular order; they want case studies and past experience,” Mr. Puranik said of some Japanese managers. “IT doesn’t work like that. There is no past experience. We have to reinvent ourselves every day.”


As it rapidly ages, Japan desperately needs more workers to fuel the world’s third-largest economy and plug gaps in everything from farming and factory work to elder care and nursing. Bending to this reality, the country has eased strict limits on immigration in hopes of attracting hundreds of thousands of foreign workers, most notably through a landmark expansion of work visa rules approved in 2018.

The need for international talent is perhaps no greater than in the tech sector, where the government estimates that the shortfall in workers will reach nearly 800,000 in the coming years as the country pursues a long-overdue national digitization effort.

The pandemic, by pushing work, education and many other aspects of daily life onto online platforms, has magnified the technological shortcomings of a country once seen as a leader in high tech.

Japanese companies, particularly smaller ones, have struggled to wean themselves from physical paperwork and adopt digital tools. Government reports and independent analyses show Japanese companies’ use of cloud technologies is nearly a decade behind those in the United States.

“As it happens to anyone who comes to Japan, you fall in love,” said Shailesh Date, 50, who first went to the country in 1996 and is now the head of technology for the American financial services company Franklin Templeton Japan in Tokyo. “It’s the most beautiful country to live in.”

Yet the Indian newcomers mostly admire Japan from across a divide. Many of Japan’s 36,000 Indians are concentrated in the Edogawa section of eastern Tokyo, where they have their own vegetarian restaurants, places of worship and specialty grocery stores. The area has two major Indian schools where children study in English and follow Indian curricular standards.

Nirmal Jain, an Indian educator, said she founded the Indian International School in Japan in 2004 for children who would not thrive in Japan’s one-size-fits-all public education system. The school now has 1,400 students on two campuses and is building a new, larger facility in Tokyo.

Ms. Jain said that separate schools were appropriate in a place like Japan, where people tend to keep their distance from outsiders.

“I mean, they are nice people, everything is perfect, but when it comes to person-to-person relationships, it’s kind of not there,” she said.

Riaz Haq said…
Rotation of #G20 presidency from #Indonesia to #India may have met with indifference in the rest of the world.But in #Modi's India, it has been emblazoned on billboards & front-page advertisements in newspapers & breathlessly discussed on TV channels. #BJP

The euphoria over India's G20 presidency shows that Hindu nationalists still need and often crave outside validation. This creates an insoluble problem for them

This month’s rotation of the G-20 presidency from Indonesia to India may have met with indifference in much of the world. In India, however, the news has been emblazoned on billboards and front-page advertisements in newspapers, and is breathlessly discussed on television channels.

The common theme of these celebrations is that the “mother of democracy” — in Prime Minister Narendra Modi’s phrase — is about to become a vishwa-guru, or teacher to the world. As the winter session of India’s parliament opened earlier this month, Modi asked its members to project a responsible face to the world in the months leading up to the next G-20 leaders’ summit in September 2023.

There is no question that for a few days that month, the eyes of the world’s media will be on India. But what will they see? And what international image does India want to project?

The common theme of these celebrations is that the “mother of democracy” — in Prime Minister Narendra Modi’s phrase — is about to become a vishwa-guru, or teacher to the world. As the winter session of India’s parliament opened earlier this month, Modi asked its members to project a responsible face to the world in the months leading up to the next G-20 leaders’ summit in September 2023.

There is no question that for a few days that month, the eyes of the world’s media will be on India. But what will they see? And what international image does India want to project?

Certainly, the emergence of a multipolar world opens up fresh opportunities for India to deploy its unused moral and intellectual capital. Preoccupied with internal troubles, the United States and Europe have left vast tracts of the Global South open to Chinese and Russian influence.

In particular, China dominates Asia, Africa and Latin America with its economic power. Last week, Chinese President Xi Jinping hailed a “new era” in his country’s relationship with Gulf nations as he met Saudi Arabia’s Crown Prince Mohammed Bin Salman in Riyadh. According to Xi, China and the Gulf countries “respect each other’s history and cultural traditions.”

Modi would have a hard time making a similar claim: He was forced to apologize earlier this year to Gulf rulers for the Islamophobic rants of one of his spokespersons. And even in countries with which India shares a Hindu-Buddhist heritage and trading links — Nepal, Sri Lanka, Thailand, Malaysia and Indonesia — India now plays second fiddle to China.
Riaz Haq said…
Rotation of #G20 presidency from #Indonesia to #India may have met with indifference in the rest of the world.But in #Modi's India, it has been emblazoned on billboards & front-page advertisements in newspapers & breathlessly discussed on TV channels. #BJP

Nor has Modi seized the intellectual leadership of the Global South — a vacancy that is rapidly being filled by Brazil’s President Luiz Inacio Lula da Silva. Emerging from years in prison, Lula has moved fast to reposition Brazil in the avant garde of the global fight against climate change. He is on his way to affirming Barack Obama’s 2009 characterization of him as “the most popular politician on earth.”

In power for nearly a decade, Modi is still struggling to make a similar impact internationally, despite his bear-hugging of world leaders. And that is because the gap between what he says abroad and what he does at home is too wide and too obvious.

Modi is not wrong to claim that India’s core philosophy is vasudev kutamban — the idea that the world is one family. India is arguably the world’s most enduring experiment in cultural pluralism. Those culture-warriors who today belligerently police boundaries of race, religion and gender could learn a great deal from the long Indian experience of multiple, overlapping identities.

Modi’s Bharatiya Janata Party has been relentlessly hostile to this older idea of India, however, as it tries to recast India as a Hindu nation. In a recent study by the Pew Research Center, India fared worse than Taliban-ruled Afghanistan in an index measuring social hostilities involving religion. On other recent rankings — ranging from press freedom to hunger — the mother of democracy has fared equally poorly.

Not surprisingly, the international media has become more critical of India in recent months. Modi now routinely features together with Donald Trump, Boris Johnson, Rodrigo Duterte and Jair Bolsonaro in a gallery of elected demagogues (though perhaps a recent snub of Vladimir Putin may soften the Indian leader’s image somewhat).

Within India, such Western reports are attacked in unison by politicians, bureaucrats, media personalities, film actors and sports stars. These remarkably well-organized and successful campaigns suggest that the silo of fake news and sectarian opinion in India is more impenetrable than anything created by Trump and Fox News.

Nevertheless, the current euphoria over India’s G-20 presidency shows that Hindu nationalists still need — and often crave — outside validation. This creates an insoluble problem for them, as their heavily Hinduized idea of India hasn’t been endorsed by many people outside the country. Evidence came only last month, when Israeli director Nadav Lapid, invited to judge an international film festival in Goa, publicly ridiculed a controversial anti-Muslim film that had been zealously promoted by Modi’s government.

Under attack from Hindu nationalist trolls, Lapid dug in and amplified his scorn. It was then echoed by his fellow foreign jurors. Israeli diplomats got involved. Thus, some small commotion at a film festival blew up into an entirely unnecessary international incident.

Such embarrassments, likely as the world examines India more closely next year, are easily avoided. In the months ahead, the government could end its pressure on dissenters, abandon its dog-whistle rhetoric against Muslims and restore the independence of democratic institutions from the media to the judiciary.

Certainly, those claiming to have mothered democracy need to narrow the great gap between propaganda and reality. For India’s timeless moral — that the world is one family — is unlikely to resonate when broadcast by people trapped in silos.
Riaz Haq said…
During the year 2022 (November), 765,172 Pakistanis proceeded abroad for the purpose of employment.
Riaz Haq said…
The Asian Development Bank (ADB) said on Wednesday that Pakistan’s economic outlook for the fiscal year ending in June 2023 has “deteriorated under heavy flooding” while the “economy was already struggling to regain macroeconomic and fiscal stability”.

In the supplement report titled ‘Asian Development Outlook 2022 Supplement’, ADB said flood disruption and damage in the country are “expected to slow real Gross Domestic Product (GDP) growth in combination with a tight monetary stance, high inflation, and an un-conducive global environment”.


the ADB report highlighted that flood damage in Pakistan threatened the upcoming agricultural season as well, as wheat is usually planted from mid-October.

It said the flooding is expected to have spillover effects on industry — notably textiles and food processing — and on services, in particular wholesale trade and transportation.

The report added that the floods had adversely affected cotton, rice and other important crops that are grown in the country.

The fiscal year 2023 forecast for Pakistan has been revised to reflect a “weaker currency [and] higher domestic energy prices” along with “flood-related crop and livestock losses and supply disruption, which have caused transitory food shortages and price spikes”, ADB elaborated in the report.

It further explained that transportation difficulties had “exacerbated these shortages and disrupted other domestic supply chains, broadening inflationary pressures and imposing production challenges”.

Growth and inflation outlook in South Asia
According to the ADB, South Asia is on track to meet the growth forecast of 6.5pc in 2022 but the forecast for 2023 has been downgraded slightly from 6.5pc to 6.3pc.

It further said sub-regional revision for 2023 largely reflected “lower forecasts for Bangladesh and Pakistan” as recovery in Bangladesh was also “hampered by external imbalances and unexpectedly high inflation”.

It projected inflation for South Asia — comprising of Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka — to increase from 8.1pc in September to 8.2pc in the recent December update.

However, the estimated inflation figures for the year 2023 had a more substantial increment from 7.4pc to 7.9pc.

The report said that the sub-regional revision for 2023 largely reflects higher inflation forecasts for Bangladesh, Nepal, Pakistan and Sri Lanka.

Inflation forecasts for elsewhere in the sub-region in 2023 remained unchanged while inflation in India is expected to rise to 6.7pc before falling back to 5.8pc in the fiscal year 2022.
Riaz Haq said…
#China is #SaudiArabia’s largest #trading partner, with #Chinese exports to #KSA reaching $30.3 billion in 2021 & Saudi exports at $57 billion in the same year. #Saudi #oil makes up 18% of #Beijing’s total crude #oil imports — worth about $55.5 billion January-October in 2022.

“The oil market, and by extension the entire global commodities market, is the insurance policy of the status of the dollar as reserve currency,” economist Gal Luft, co-director of the Washington-based Institute for the Analysis of Global Security, told the Journal at the time. “If that block is taken out of the wall, the wall will begin to collapse.”


Saudi Arabia, meanwhile, has great ambitions to diversify its economy, which has for decades relied on crude oil output. But in order to do that, it needs money — oil money. That’s at least part of why Saudi Arabia limited production in the midst of a global oil crisis and prices for crude oil remain high.

Both nations also tout ambitious infrastructure projects. The Belt and Road initiative, China’s effort to create a 21st-century Silk Road international trade route by providing the finances to develop series of ports, pipelines, railroads, bridges, and other trade infrastructure to nations across Asia and Africa, is a milestone effort for Xi. It’s also received major criticism for potentially exploiting poor nations by essentially loaning them money they can’t pay back, in some cases granting China control over these critical hubs.

Xi’s presence in Saudi Arabia, both with MBS and as part of a larger summit with Arab and Gulf Cooperation Council (GCC) nations, present multiple opportunities to strengthen ties with a host of nations in the region — and to make sure that in the global power competition, those nations are, at least, not aligned with the US, as Shannon Tiezzi wrote in The Diplomat Wednesday.

Critically, Saudi Arabia knows it cannot depend on generous US weapons sales under Biden, so China is an increasingly viable alternative. In fact, Reuters reported, Saudi Arabia is thought to have signed $30 billion in defense contracts at this summit with China.

In forging their alliance, both nations get a strong trading partner who won’t question their policies; Saudi Arabia gets a more predictable relationship in Xi than it has seen in the switch from former President Donald Trump to Biden.

How does this affect the US and its global position as a superpower?
The US-Saudi relationship is longstanding. It officially started toward the end of World War II, and the basic oil-for-security trade has lasted for decades, becoming increasingly important to the kingdom between Iraq’s invasion of Kuwait in the 1990s and the increasing influence of regional rival Iran. Despite Saudi repression and alleged human rights abuses, Riyadh could count on US weapons, and the US could almost always count on cheap Saudi oil.

Of course, there have been tensions in the relationship before. The 1973 oil embargo in retaliation for the US decision to resupply the Israeli military during the Arab-Israeli War, as well as Saudi involvement in the terror attacks on September 11, 2001, tested the alliance, but US leadership maintained that the kingdom was a key regional partner nonetheless.

Under Trump, the relationship between the two nations was somewhere between transactional and downright chummy — Trump even reportedly bragged that he defended MBS against criticism from Congress over Khashoggi’s death.

But the relationship has become the most strained it has been in recent memory due to MBS’s abuses and Biden’s criticism. In March, after Russia’s invasion of Ukraine sparked a fuel shortage, MBS refused to take Biden’s calls to negotiate increased oil production and help ease prices. When they finally met in July, Biden was extremely uncomfortable — and he left almost empty-handed.
Riaz Haq said…
CPEC special economic zones to generate huge job opportunities in Pakistan: official

Four special economic zones (SEZs) being set up under the framework of the China-Pakistan Economic Corridor (CPEC) are likely to generate about 575,000 direct and over 1 million indirect jobs in Pakistan, a senior official said on Thursday.

The economic zones being established in the country's Khyber Pakhtunkhwa (KP), Punjab, Sindh and Balochistan provinces would bring about immense opportunities for Pakistani people in job and business sectors, Chairman of Special Economic Zones Authority S.M. Naveed said.

"We have conducted a study to assess job opportunities in four out of nine SEZs, including KP's Rashakai, Sindh's Dhabeji, Punjab's Allama Iqbal and Balochistan's Bostan, to find out potential jobs and industries in the SEZs," the official said, adding that the SEZs offer employment in different fields for which the local youth would be trained before the initiation of the industrial phase.

The trained and skilled labor and engineers would not only get good jobs in the economic zones but also enable Chinese and local companies to recruit skilled professionals from local areas, he added.

The potential industries being set up in the CPEC special economic zones include food processing, cooking oil, ceramics, gems and jewelry, marble, minerals, agriculture machinery, iron and steel, motorbike assembling, electrical appliances and automobiles.

Launched in 2013, CPEC is a corridor linking Pakistan's Gwadar Port with Kashgar in northwest China's Xinjiang Uygur Autonomous Region, which highlights energy, transport and industrial cooperation. ■
Riaz Haq said…
Morgan Stanley's Ridham Desai, Chetan Ahya and Upasana Chachra: India is on track to become the world’s third largest economy by 2027, surpassing Japan and Germany, and have the third largest stock market by 2030, thanks to global trends and key investments the country has made in technology and energy.

India is already the fastest-growing economy in the world, having clocked 5.5% average gross domestic product growth over the past decade. Now, three megatrends—global offshoring, digitalization and energy transition—are setting the scene for unprecedented economic growth in the country of more than 1 billion people.

“We believe India is set to surpass Japan and Germany to become the world’s third-largest economy by 2027 and will have the third-largest stock market by the end of this decade,” says Ridham Desai, Morgan Stanley’s Chief Equity Strategist for India. “Consequently, India is gaining power in the world order, and in our opinion these idiosyncratic changes imply a once-in-a-generation shift and an opportunity for investors and companies.”

All told, India’s GDP could more than double from $3.5 trillion today to surpass $7.5 trillion by 2031. Its share of global exports could also double over that period, while the Bombay Stock Exchange could deliver 11% annual growth, reaching a market capitalization of $10 trillion in the coming decade.

In a new Morgan Stanley Research Bluepaper, analysts working across sectors look at how this new era of economic development could bring about staggering changes: boosting India’s share of global manufacturing, expanding credit availability, creating new businesses, improving quality of life and spurring a boom in consumer spending.

“In a world that is currently starved of growth, the opportunity set in India must be on global investors’ radar,” says Chetan Ahya, Morgan Stanley’s Chief Asia Economist. “India will be one of only three economies in the world that can generate more than $400 billion annual economic output growth from 2023 onward, and this will rise to more than $500 billion after 2028.”

Global Offshoring Creates a Workforce for the World
Companies around the world have been outsourcing services such as software development, customer service and business process outsourcing to India since the early days of the Internet. Now, however, tighter global labor markets and the emergence of distributed work models are bringing new momentum to the idea of India as the back office to the world.

“In a post-Covid environment, CEOs are more comfortable with both work from home and work from India,” says Desai. In the coming decade, he notes, the number of people employed in India for jobs outside the country is likely to at least double, reaching more than 11 million, as global spending on outsourcing swells from $180 billion per year to around $500 billion by 2030.

India is also poised to become the factory to the world, as corporate tax cuts, investment incentives and infrastructure spending help drive capital investments in manufacturing.

“Multinationals are now buoyant about the prospects of investing in India, and the government is helping their cause by investing in infrastructure as well as supplying land for building factories,” says Upasana Chachra, Chief India Economist. Morgan Stanley data shows that multinational corporations’ sentiment on the investment outlook in India is at an all-time high. Manufacturing’s share of GDP in India could increase from 15.6% currently to 21% by 2031—and, in the process, double India’s export market share.

India's Share of Manufacturing is expected to increase to 21% of GDP by 2031
Riaz Haq said…
Mobile banking doubles, internet banking grows by 51.7% in FY2021-22
As internet banking, POS, and eCommerce transactions post strong growth, the digital payments ecosystem is picking up steam

The past fiscal year has seen a massive increase in the size of the digital payments ecosystem, the State Bank of Pakistan’s (SBP) Annual Payment Systems Review for 2021-22 revealed. The report says that mobile phone banking increased by 100.4% to 387.5 million, while internet banking grew by 51.7% to 141.7 million during the year.

The impressive numbers come on the back of an important year for the ecosystem that saw a number of milestones. With the SBP backed Raast getting traction, and electronic money institutions (EMIs) gaining popularity among customers, the signs are pointing towards money quickly becoming digital. Cash transactions have also gained momentum with ATM networks proliferating and cash withdrawals from ATMs also posting double digit growth over last year.

The tools for growth

By value, mobile phone banking and internet banking grew strongly by 141.1% and 81.1%, thus, reaching to Rs11.9 trillion and Rs10.2 trillion respectively. Ecommerce transactions also witnessed similar trends as the volume grew by 107.4% to 45.5 million and the value by 74.9% to Rs106 billion.

During FY22, a total of 32,958 Point of Sales (POS) machines were deployed in the country which led to an expansion of its network by 45.8% to 104,865. The total number of transactions through POS, 137.5 million, were 54.5% higher than previous fiscal year with transaction value reaching Rs0.7 trillion growing by 56.1%.

E-commerce merchants registered with the banks increased to 4,887 in FY21-22, from 3,003 merchants during the previous year. In continuation of its efforts to promote and enhance the digital payment system in the country, SBP launched Raast Person-to-Person (P2P), which enabled payments among individuals, businesses and other entities to settle transactions in real-time. According to the report, as of June-22, there were 15 million registered P2P Raast users, carrying out 7.9 million transactions amounting to Rs 102.1 billion in value. Raast was launched in November last year.

The number of large-value transactions through the Real-Time Gross Settlement (RTGS) system of Pakistan reached 4.37 million by FY22 amounting to Rs 681.6 trillion with an annual growth of 53.3% in value. During FY22, paper-based transactions declined by 1.0% in volume though its value grew to Rs 190.4 trillion, almost 25.6% higher than last year.

According to the State Bank’s Annual Payment Systems Review, the number of conventional bank account holders increased by 4.5 million, from 63 million account holders in 2021 to 67.5 million in 2022. On the other hand, branchless banking accounts increased from 74.6 million to 88.5 million, a growth of 18.6%.

Give me the cash, but digitally

Considering cash transactions are still predominant, the ATM network in Pakistan needs to be strong to cater to needs. The ATMs network in the country also grew by 4.8% during the year reaching 17,133 ATMs.

A total of 692.3 million transactions were carried out through ATMs which amounted to Rs 9.6 trillion, 19.2% higher than FY21. Meanwhile, cash withdrawals from ATMs picked up from 577.3 million in volume and Rs7.29 trillion in value in 2020-21, to 670.6 million in volume and Rs8.6 trillion in value. That’s a growth of 16.1% in volume and 18% in value over the previous year.

Plastic money on my mind

There were 42.4 million payment cards in circulation in FY22 including 71.1% or 30.16 million debit cards; 24.3% or 10.3 million social welfare cards; 4.2% or 1.79 million credit cards and the rest were pre-paid and ATM only cards.
Riaz Haq said…
Mobile banking doubles, internet banking grows by 51.7% in FY2021-22
As internet banking, POS, and eCommerce transactions post strong growth, the digital payments ecosystem is picking up steam

The overall number of payment cards, however, decreased during the year, from 45.9 million in 2020-21 to 42.4 million in 2021-22.

Bring in the fintech

According to the State Bank’s annual report, the four fully licensed EMIs (electronic money institution); Sadapay, Nayapay, Finja and CMPECC, combined had 262,558 total active accounts and 514,961 payment cards issued to their customers. Last year’s numbers on EMIs were not available for a comparison on how these numbers have grown.

The SBP has in the past has often emphasised on the potential fintech can play to boost digital payments and financial inclusion.

During his speech at the Institute of Banking Pakistan Annual Award Ceremony, Jameel Ahmad, Governor SBP stressed on the need for banks to revisit their traditional approach to service delivery and adapt quickly as digitalization shifts the balance of power from banks to tech savvy entities, hinting at the growing trend in fintech.

“Leveraging digital technology is essential not only to promote financial inclusion, but also to ensure that the industry keeps pace with emerging global trends,” opined Ahmed.

Speaking on the importance of technology, Ahmad quotes M-Pesa, a Kenyan fintech. “An often-cited success story is that of M-Pesa in Kenya, where it single-handedly drove mobile financial services availability and successfully raised financial services access in Kenya. “

Ahmad pointed out that a number of factors already exist in Pakistan that can help drive digital financial innovation and proliferation of a tech-based financial ecosystem. He pointed out that the nation has a fully functional digital ID system, ubiquity of mobile devices, penetration of mobile and broadband services, availability of faster payment rails, remote account opening process, and facilitative regulatory environment for enabling the entry of non-bank entities into the financial arena.

The Central Banker also points out that while fintech has brought competition, it also presents the sector with an opportunity to create synergies and mutually beneficial partnerships.

“Banks and Fintechs can partner with each other to provide innovative products for customers that are otherwise not viable on a standalone basis. For banks, such partnerships can help with penetration in untapped segments like retail businesses and Micro and Small Medium Enterprises, yielding beneficial outcomes for all stakeholders,” he said.

Encouraging the banks that are yet to make consistent and sustained moves toward technological transformation, Ahmad told them to make use of the digital bank frameworks and the instant payment system, RAAST, to position themselves for the future.

Riaz Haq said…
In mid-April, India is forecast to surpass China as the world's most populous country.

The Asian giants already have more than 1.4 billion people each, and for over 70 years have accounted for more than a third of the global population.

China's population is likely to begin shrinking next year. Last year, 10.6 million people were born, a little more than the number of deaths, thanks to a rapid drop in fertility rate. India's fertility rate has also fallen substantially in recent decades - from 5.7 births per woman in 1950 to two births per woman today - but the rate of decline has been slower.

So what does India overtaking China as the most populous country in the world mean?

China reduced its population growth rate by about half from 2% in 1973 to 1.1% in 1983.

Demographers say much of this was achieved by riding roughshod over human rights - two separate campaigns promoting just one child and then later marriages, longer gaps between children and fewer of them - in what was a predominantly rural and overwhelmingly uneducated and poor country,

India saw rapid population growth - almost 2% annually - for much of the second half of the last century. Over time, death rates fell, life expectancy rose and incomes went up. More people - especially those living in cities - accessed clean drinking water and modern sewerage. "Yet the birth rate remained high," says Tim Dyson, a demographer at the London School of Economics.

India launched a family planning programme in 1952 and laid out a national population policy for the first time only in 1976, around the time China was busy reducing its birth rate.

But forced sterilisations of millions of poor people in an overzealous family planning programme during the 1975 Emergency - when civil liberties were suspended - led to a social backlash against family planning. "Fertility decline would have been faster for India if the Emergency hadn't happened and if politicians had been more proactive. It also meant that all subsequent governments treaded cautiously when it came to family planning," Prof Dyson says.

East Asian countries such as Korea, Malaysia, Taiwan and Thailand, which launched population programmes much later than India, achieved lower fertility levels, cut infant and maternal mortality rates, raised incomes and improved human development earlier than India.

India has added more than a billion people since Independence in 1947, and its population is expected to grow for another 40 years. But its population growth rate has been declining for decades now, and the country has defied dire predictions about a "demographic disaster".

So India having more people than China is no longer significant in a "concerning" way, say demographers.

Rising incomes and improved access to health and education have helped Indian women have fewer children than before, effectively flattening the growth curve. Fertility rates have dipped below replacement levels - two births per woman - in 17 out of 22 states and federally administered territories. (A replacement level is one at which new births are sufficient to maintain a steady population.)

The decline in birth rates has been faster in southern India than in the more populous north. "It is a pity that more of India could not have been like south India," says Prof Dyson. "All things being equal, rapid population growth in parts of north India have depressed living standards".

Riaz Haq said…

In mid-April, India is forecast to surpass China as the world's most populous country.

It could, for example, strengthen India's claim of getting a permanent seat in the UN Security Council, which has five permanent members, including China.

India is a founding member of the UN and has always insisted that its claim to a permanent seat is just. "I think you have certain claims on things [by being the country with largest population]," says John Wilmoth, director of the Population Division of the UN Department of Economic and Social Affairs.

The way India's demography is changing is also significant, according to KS James of the Mumbai-based International Institute for Population Sciences.

Despite drawbacks, India deserves some credit for managing a "healthy demographic transition" by using family planning in a democracy which was both poor and largely uneducated, says Mr James. "Most countries did this after they had achieved higher literacy and living standards."

More good news. One in five people below 25 years in the world is from India and 47% of Indians are below the age of 25. Two-thirds of Indians were born after India liberalised its economy in the early 1990s. This group of young Indians have some unique characteristics, says Shruti Rajagopalan, an economist, in a new paper. "This generation of young Indians will be the largest consumer and labour source in the knowledge and network goods economy. Indians will be the largest pool of global talent," she says.

India needs to create enough jobs for its young working age population to reap a demographic dividend. But only 40% of of India's working-age population works or wants to work, according to Centre for Monitoring Indian Economy (CMIE).

More women would need jobs as they spend less time in their working age giving birth and looking after children. The picture here is bleaker: only 10% of working-age women were participating in the labour force in October, according to CMIE, compared with 69% in China.

Then there's migration. Some 200 million Indians have migrated within the country - between states and districts - and their numbers are bound to grow. Most are workers who leave villages for cities to find work. "Our cities will grow as migration increases because of lack of jobs and low wages in villages. Can they provide migrants a reasonable living standard? Otherwise, we will end up with more slums and disease," says S Irudaya Rajan, a migration expert at Kerala's International Institute of Migration and Development.

Demographers say India also needs to stop child marriages, prevent early marriages and properly register births and deaths. A skewed sex ratio at birth - meaning more boys are born than girls - remains a worry. Political rhetoric about "population control" appears to be targeted at Muslims, the country's largest minority when, in reality, "gaps in childbearing between India's religious groups are generally much smaller than they used to be", according to a study from Pew Research Center.

And then there's the ageing of India
Demographers say the ageing of India receives little attention.

In 1947, India's median age was 21. A paltry 5% of people were above the age of 60. Today, the median age is over 28, and more than 10% of Indians are over 60 years. Southern states such as Kerala and Tamil Nadu achieved replacement levels at least 20 years ago.

"As the working-age population declines, supporting an older population will become a growing burden on the government's resources," says Rukmini S, author of Whole Numbers and Half Truths: What Data Can and Cannot Tell Us About Modern India.

"Family structures will have to be recast and elderly persons living alone will become an increasing source of concern," she says.

Presentational grey line
Riaz Haq said…
Banks’ income, assets flourish in 1HCY22

Banking in Pakistan flourished during the first half of the calendar year 2022; both assets and income noted a strong increase while the balance sheet of banks expanded by 16 per cent over the same period of last year.

The State Bank issued a “mid-year performance review” (MYPR) of the banking sector for 2022 on Monday.

The review covers the performance and soundness of the banking sector for the January-June period (1HCY22).

It also covers the performance of financial markets and microfinance banks (MFBs), as well as the results of Systemic Risk Survey (SRS), which represents independent respondents’ views about key risks to financial stability.

The sustained economic activity during 1HCY22 supported the expansion of banking sector balance sheet by 16pc during 1HCY22, said the report.

A robust increase in the asset base was mai­nly driven by the flow of private sector advances and increases in investments, particu­larly government securities, said the report.

Investments rose by 22.5pc (Rs3.3 trillion) during 1HCY22. “These funds were almost entirely invested in government securities,” said the SBP report.

Investments in MTBs (market treasury bills) and PIBs (Pakistan Investment Bonds) observed a rise of Rs684 billion and Rs1.7tr, respectively.

Also, Ijara Sukuk attracted substantial bank funds of Rs838 billion in the first half of the present calendar year. Accordingly, the share of MTBs in banks’ total holding of federal government securities declined to 33.6pc by the end of June this year from 46.6pc a year ago. The share of PIBs shot up to 52.6pc from 46pc in June -2021.

“Increased share of long-term investments demonstrates the government’s strategy to improve its debt maturity profile,” said the SBP. The pace of growth in private sector advances during 1HCY22 was the highest in comparable periods of the previous three years. Improved manufacturing activity, as reflected in double-digit growth in the Large-Scale Manufacturing (LSM) index during 1HCY22, higher input prices and SBP’s refinance schemes augmented the overall flow of advances.

Individuals and the sugar sector availed a major chunk of financing, followed by the textile sector.

However, the monetary policy announced on Nov 24 had said that in line with the slowdown in economic activity, private sector credit continued to moderate, increasing only by Rs86.2 billion during Q1 FY23 (July 1 to Sept 30, 2022), compared to Rs226.4 billion during the same period last year.

This deceleration was mainly due to a significant decline in working capital loans to wholesale and retail trade services, as well as to the textile sector in the wake of lower domestic cotton output, and a slowdown in consumer finance, said the monetary policy.
Riaz Haq said…
News From India:

Myanmar expands defence industrial partnership with Pakistan for JF-17

Myanmar is indulging in a delicate balancing act by stepping up military engagement with the China-Pakistan axis on one hand and Russia on the other by near simultaneous hosting of military delegations from Pakistan and Russia.

While a Pakistani delegation led by Colonel Imran Khan visited Myanmar capital Naypyitaw last week to discuss military cooperation with the junta, in continuation of a series of visits from Pakistan military establishment to Myanmar since September, the junta al ..

The Pakistani team visited Myanmar regarding technical support for JF-17 aircraft jointly developed by China and Pakistan, ET has further learnt.

A 10-member team from Myanmar Air Force (MAF) is currently in Pakistan undergoing training for four weeks on precision targeting in air operations and on the JF-17 jet fighter.

Myanmar bought 16 JF-17’s from China. The first batch of six aircraft was delivered in 2018, but details about the delivery date for the other 10 remain unclear. Myanmar was the first country to buy the JF-17, sources told ET.

In October, a senior-level Pakistani military delegation visited Myanmar to provide technical assistance to manufacture weapons, ET had reported earlier

In September, a Myanmar military team had visited Pakistan to inspect delivery of bombs and bullets that it had ordered from Islamabad, according to persons familiar with the development. This team again visited Pakistan earlier this month for pre-shipment inspection of deliveries.

Pakistan was also reportedly considering selling heavy machine guns, 60 mm and 81 mm mortars and M-79 grenade launchers to Myanmar, ET had earlier reported.

Pakistan was formerly a strong critic of the Myanmar government for what it alleged was a “state-sponsored campaign” against Rohingyas in western Myanmar’s Rakhine state. Myanmar had in the past accused Pakistan of arming and training a radical group, the Arakan Rohingya Salvation Army.
Riaz Haq said…
Indian economy grew 8.7% in last fiscal year to surpass pre-Covid levels, IMF says
Growth expected to moderate to 6.8% in current year amid tighter financial conditions

India’s real gross domestic product grew by 8.7 per cent in the 2021-2022 fiscal year, boosting its total output above pre-coronavirus levels despite global macroeconomic headwinds, the International Monetary Fund has said.

India, Asia's third-largest economy and the world's fifth largest, rebounded from the deep pandemic-induced downturn on the back of fiscal measures to address high prices and monetary policy tightening to address elevated inflation, the Washington-based lender said in a report on Friday.

“Economic headwinds include inflation pressures, tighter global financial conditions, the fallout from the war in Ukraine and associated sanctions on Russia, and significantly slower growth in China and advanced economies,” the fund said.

“Growth has continued this fiscal year, supported by a recovery in the labour market and increasing credit to the private sector.”

In October, the IMF cut its global economic growth forecast for next year, amid the Ukraine conflict, broadening inflation pressures and a slowdown in China, the world’s second-largest economy.

The fund maintained its global economic estimate for this year at 3.2 per cent but downgraded next year's forecast to 2.7 per cent — 0.2 percentage points lower than its July forecast.

There is a 25 per cent probability that growth could fall below 2 per cent next year, the IMF said in its World Economic Outlook report at the time.

Global economic growth in 2023 is expected to be as weak as in 2009 during the financial crisis as a result of the Ukraine conflict and its impact on the world economy, according to the Institute of International Finance.

Economic growth in India is expected to moderate, reflecting the less favourable outlook and tighter financial conditions, the IMF said.

Real GDP is projected to grow at 6.8 per cent for the current financial year to the end of March, and by 6.1 per cent in 2023-2024 fiscal year, according to the fund's estimates.

Reflecting broad-based price pressures, inflation in India is forecast at 6.9 per cent in the 2022-2023 fiscal year and expected to moderate only gradually over the next year.

Rising inflation can further dampen domestic demand and affect vulnerable groups, according to the fund.

India’s current account deficit is expected to increase to 3.5 per cent of GDP in the 2022-2023 fiscal year as a result of both higher commodity prices and strengthening import demand, the lender said.

“A sharp global growth slowdown in the near term would affect India through trade and financial channels,” it said.

“Intensifying spillovers from the war in Ukraine can cause disruptions in the global food and energy markets, with significant impact on India. Over the medium term, reduced international co-operation can further disrupt trade and increase financial markets’ volatility.”

However, the successful introduction of wide-ranging reforms or greater-than-expected dividends from the advances in digitalisation could increase India’s medium-term growth potential, the IMF said.

Additional monetary tightening should be carefully calibrated and communicated, it said.

“The exchange rate should act as the main shock absorber, with intervention limited to address disorderly market conditions,” the report said.

The IMF also recommended that India’s financial sector policies should continue to support the exit of non-viable companies and encourage banks to build capital buffers and recognise problem loans.

Reforms to strengthen governance and reduce the government’s footprint are needed to support strong medium-term growth, it said.

The lender also highlighted the need for structural reforms to promote resilient, green and inclusive growth.
Riaz Haq said…
Arvind Panagariya cautions against cutting trade ties with China

“Engaging China in a trade war at this juncture will mean sacrificing a considerable part of our potential growth... purely on economic grounds, it will be unwise to take any action in response to it (transgressions on the border),” the eminent economist told PTI.

Amid demands for snapping trade ties with China for its transgressions on the border, former NITI Aayog Vice-Chairman Arvind Panagariya has opined that cutting trade ties with Beijing at this juncture would amount to sacrificing India's potential economic growth.

Instead, Mr. Panagariya suggested that India should try to enter into free trade agreements (FTA) with countries such as the U.K. and the European Union to expand its trade.


Mr. Panagariya, currently a professor of economics at Columbia University, said both countries can play the trade sanctions game but the ability of a $17 trillion economy (China) to inflict injury on a $3 trillion economy (India) is far greater than the reverse.

"Now, there are some who want trade sanctions on China to 'punish' it for its transgressions on the border... if we try to punish China, it will not sit back, as amply illustrated by its response to sanctions by even the mighty United States," he observed.

Mr. Panagariya pointed out that even a large economy such as the U.S. has not been very successful with its sanctions either against China or even Russia.

"Its close ally, EU, has had to pay a very high price of the sanctions against Russia. So, this is a very slippery slope," he observed.

The trade deficit, the difference between imports and exports, between India and China touched $51.5 billionduring April-October this fiscal. The deficit during 2021-22 had jumped to $73.31 billion as compared to $44.03 billion in 2020-21, according to the latest government data According to the data, imports during April-October this fiscal stood at $60.27 billion, while exports aggregated at $8.77 billion.
Riaz Haq said…
Pakistan: Top Performing Sectors And Scrips Of 2022 – OpEd

Let me and you accept the harsh reality that 2022 was a bad year for Pakistan’s capital market. Market value (market capitalization) of companies listed at Pakistan Stock Exchange (PSX) declined 17% to RKR6.4 trillion. In US$ terms it plummeted 35% to US$28 billion. Still there are some islands of excellence.

Real Estate Investment Trust (REIT), Synthetic & Rayon, and Sugar were the top performing sectors in 2022 as their market cap increased by 12%, 6% and 5% respectively, despite bad market conditions.

Technology sector was up 2% and outperformed the market despite fall in global listed technology stocks.

As against these, Engineering, Automobile Parts, and Miscellaneous sectors remained the worst performing sectors posting decline of 45%, 41% and 34% respectively.

REIT sector that has only one listed company gained in 2022 due to stable dividend yield coupled with changes in regulations on REITs investment for banks. To recall, State Bank of Pakistan (SBP) recently allowed banks to count their investments in shares issued by REIT towards achievement of housing and construction finance targets.

Synthetic & Rayon also posted strong performance led by rally in Ibrahim Fiber Limited (IBFL).

Sugar sector performance was led by JDW Sugar Mills (JDWS) that announced buy back.

Engineering sector (mainly steel related companies) was badly impacted due to economic slowdown and subdued construction activity.

Automobile parts sector also remained amongst worst performing sectors primarily due to import restrictions, high financing rates and lackluster demand.

For its analysis, Pakistan’s leading brokerage house, Topline Securities assumed sectors with minimum market capitalization of US$100 million adjusted for new listings including Adamjee Insurance (AICL), and Telecard Limited (GEMSNL).

Lotte Chemical (LOTCHEM) doubled while Airlink was down substantially in 2022. LOTCHEM was the top performing stock of the market in 2022 where the scrip gained more than 100%. Investors were excited over potential sell off by Lotte Chemical Corporation South Korea (parent company of LOTCHEM) and subsequent public offer for minority shareholders.

LOTCEHM was followed by Faysal Bank (FABL) and Unilever Pakistan Foods (UPFL). The strong stock performance by FABL is on announcement to convert into an Islamic Bank followed by a special dividend.

Similarly, UPFL stock was up 34% as the company posted strong profitability growth of 33%YoY in 9M2022.

Systems Limited (SYS), Pakistan’s largest listed IT firm remained amongst the top performing stocks for the third consecutive year as the company continued to post strong profitability growth in spite of economic challenges.

Air Link Communication (AIRLINK) declined 54% due to low profits led by lower volumetric sales.

Gul Ahmed Textile Mills (GATM) also reported decline by 52% amid slowdown in textile exports.

Searle Company Limited (SEARLE) was down 52% due to lower profits led by falling gross margins driven by significant jump in raw material cost and company’s inability to immediately pass full impact on to consumers.
Riaz Haq said…
Unlocking Pakistan’s digital potential: The economic opportunities of digital transformation and Google’s contribution

Pakistan’s vibrant technology sector has grown significantly in recent years and is well-positioned for further growth. The country produces over 20,000 Information Technology (IT) graduates each year, has nurtured over 700 tech start-ups since 2010, and has the fourth highest earning IT workforce in the world. Pakistan’s technology sector also has a large export element, with annual revenue from exports of IT and IT-enabled Services (ITeS) accounting for USD1.4 billion in 2020 – having grown at 10.8 percent per year since 2010. Furthermore, the government has identified the creation of a holistic digital ecosystem – most prominently in its “Digital Pakistan Policy” – as one of the key levers of economic growth.

Despite these significant achievements, the country can go further in its digital transformation journey. Pakistan’s online population has grown rapidly at 68 percent per annum from 2016 to 2019, and the Internet penetration rate reached 35 percent in January 2020. However, the country faces several hurdles to full digital transformation. For example, the World Economic Forum’s “Global Competitiveness Index 2019” ranked Pakistan as 73rd out of 141 countries on the ability of the active working population to possess and use digital skills. Digital transformation will also be important to boost its economic recovery efforts and enhance the long-term resilience of businesses in adapting to future “black swan” events in the post-pandemic era.

There is a significant economic prize attached to accelerating Pakistan’s digital transformation. AlphaBeta’s study (commissioned by Google) finds that digital technologies can unlock PKR9.7 trillion (USD59.7 billion) worth of annual economic value in Pakistan by 2030.

Key messages from the research include:

There is a significant economic prize attached to accelerating Pakistan’s digital transformation. If fully leveraged by 2030, digital technologies could create up to PKR9.7 trillion (USD59.7 billion) in economic value. This is equivalent to about 19 percent of the country’s GDP in 2020. The sectors projected to be the largest beneficiaries are agriculture and food; consumer, retail and hospitality; and education and training. For example, machine learning algorithms have shown to be beneficial for the agricultural and food sector, where AI-powered technologies can monitor ecological conditions to determine whether crops need irrigation or not, reducing water use.
There are three areas of action required for Pakistan to fully capture its digital opportunity: i) develop infrastructure to support the local tech ecosystem; ii) create a conducive environment for IT exports, and iii) promote innovation and digital skills. A range of policies by the Pakistani government has already been introduced to accelerate digital transformation such as “Right of Way” policy, which expedites the expansion of telecom infrastructure, and the “Brand Pakistan” campaign, which promotes the country’s exports via digital platforms. However, there is further scope of actions for Pakistan to consider such as increasing Internet availability through infrastructure investments, especially in rural areas (e.g., Thailand’s “Net Pracharat” programme to expand the national broadband network), creating an accommodative tax framework and ease restrictive data policies, and forging close public-private partnerships to improve the relevance of skills trainings (e.g., “Philippines Talent Mapping Initiative” which involved Philippines’ Department of Labour and Employment consulting with employers to create a framework to analyse the competencies of Filipinos).
Riaz Haq said…
What Does It’s Always Darkest Before the Dawn Mean?
Home » Phrase and Idiom Dictionary » What Does It’s Always Darkest Before the Dawn Mean?

Definition: Don’t give up during hard times because things are hardest right before they get better.

Origin of It’s Always Darkest Before the Dawn
The first person to use this proverb was Thomas Fuller, an English theologian, in the year 1650. It appeared in his work titled A Pisgah-Sight of Palestine and the Confines Thereof.

The idea behind this is related to the literal meaning of dawn. Dawn begins when the first light begins to show over the horizon from the sunrise. Therefore, there is the least light before dawn begins, because there is no sunlight at that point. That is also the longest point since last seeing light.

Riaz Haq said…
The year 2023 marks a historic turning point for Asia's demography: For the first time in the modern era, India is projected to surpass China as the most populous country.

Besides China (1.426 billion) and India (1.417 billion), five other Asian countries had over 100 million people as of 2022, the U.N. figures show. Indonesia had 276 million, Pakistan's population was at 236 million, Bangladesh counted 171 million, Japan had 124 million and the Philippines had 116 million. Vietnam, with 98 million, is expected to join the club soon.

Even though economists expect India's gross domestic product to grow around 7% in 2023 -- the highest among major economies -- and although the worst of the COVID-19 pandemic appears to be over, India continues to face high unemployment rates of around 8%, according to the Center for Monitoring Indian Economy, a local private researcher. That shows the country is not creating enough jobs to support the growing population.


Kumagai also said that India's growing demand for food could be felt beyond its borders.

"The challenge for India concerning food is that the production of agricultural products is easily affected by the weather," he said. "On the other hand, domestic demand is increasing rapidly. As such, when production is low, domestic supply is prioritized, which eventually may lead to restrictions on exports, just as India restricted wheat exports in 2022, which could cause food problems in other countries as well."

While the South Asian nation's growing and youthful population spells opportunities for development, it also creates layers of challenges, from poverty reduction to education. Experts say soaring demand for food could affect India's trade with other countries, while the World Bank recently estimated that India will need to invest $840 billion into urban infrastructure over the next 15 years to support its swelling citizenry.

"This is likely to put additional pressure on the already stretched urban infrastructure and services of Indian cities -- with more demand for clean drinking water, reliable power supply, efficient and safe road transport amongst others," the bank's report said.

India's dilemmas are only part of a complex and diverging Asian population picture -- split between young, growing countries and aging, declining ones. Humanity's latest milestone turns a spotlight on this gap and the problems on both sides of it.


Reaching a world of 8 billion people signals significant improvements in public health that have increased life expectancy, the U.N. said. But it also pointed out, "The world is more demographically diverse than ever before, with countries facing starkly different population trends ranging from growth to decline."

Nowhere is this more apparent than in Asia. The region has young countries with a median age in the 20s, such as India (27.9 years old), Pakistan (20.4) and the Philippines (24.7), as well as old economies with median ages in the 40s, including Japan (48.7) and South Korea (43.9). The gap between the young and the old has gradually widened over the past decades.

While India faces a lack of jobs and infrastructure to support its growing population, Japan faces a serious reduction in births, accelerated by the COVID-19 pandemic, which its government says is a "critical situation." Either way, the population trends are increasingly impacting economies and societies.

Even though economists expect India's gross domestic product to grow around 7% in 2023 -- the highest among major economies -- and although the worst of the COVID-19 pandemic appears to be over, India continues to face high unemployment rates of around 8%, according to the Center for Monitoring Indian Economy, a local private researcher. That shows the country is not creating enough jobs to support the growing population.

Riaz Haq said…
Sadanand Dhume
Contrary to all the hype, India’s market for consumer goods remains very small. The Chinese buy about 8X more iPhones and nearly 100X more BMWs than Indians. Starbucks has 20X as many outlets in China as in India. [My take] v

With his love for alliteration, Prime Minister Narendra Modi often talks India up by referring to its three Ds: democracy, demography and demand. They are supposed to “propel the nation to new heights of economic progress,” to quote one of his tweets. The slogan underscores a widely held belief in India on which Mr. Modi’s economic policy relies—that the country has a large market irresistible to foreign firms. Unfortunately, that isn’t true.


One can see how Mr. Modi and others came to believe in the myth of the massive Indian market. It’s easy to confuse the size of a country’s economy or population with the size of its domestic market. India’s gross domestic product of $3.2 trillion makes it the fifth largest in the world. This year India will overtake China to become the world’s most populous nation.

A population of 1.4 billion does indeed translate into a large market for some products. About 1.2 billion Indians own cellphones, of which half are smartphones. Facebook has 330 million users in India, nearly twice as many as in the U.S. India was the third-largest consumer of oil in 2021, behind America and China. According to the Stockholm International Peace Research Institute, India was the largest arms importer in the world between 2017 and 2021. India was the top weapons export market for Russia, France and Israel.

But the size of India’s consumer market has long been hyped. A widely cited 2007 McKinsey report giddily predicted that by 2025 “India will become a middle class country” with 583 million middle-class consumers. In 2017, Morgan Stanley said India’s 400 million millennials were “one of the world’s strongest sources of untapped economic potential.” It described them sitting “in Mumbai cafés, browsing social media accounts on their smartphones while occasionally shopping for new shoes online.”

Reality is much more drab. Though India has many potential consumers, they have very little purchasing power, economists Shoumitro Chatterjee and Arvind Subramanian wrote in a 2020 paper. Though the country’s population matches China’s, India’s “true market” is only about 15% to 20% as large. India represents only 1.5% to 5% of the global market.

The Pew Research Center estimates that only 66 million Indians—less than 5% of the population—have a middle-class daily income of between $10.01 and $20 in purchasing-power terms. In China, that number is 493 million, or 34.9% of the population. In short, the vaunted Indian middle class wields much slimmer wallets than its Chinese counterpart.

Take cars, a consumer good that’s emblematic of the middle class world-wide. In 2021 Chinese bought 26.3 million cars, more than seven times as many as the 3.7 million cars Indians purchased that year, by the International Organization of Motor Vehicle Manufacturers’ estimate. For luxury brands like BMW, the Chinese market is nearly 100 times as large as India’s.

The number of Indians who can afford to watch movies on Netflix, FaceTime friends on an iPhone, or stop by a Starbucks for a cappuccino remains vanishingly small. Less than 3% of Netflix’s 223 million users are in India—despite the company’s charging them less than half what it does U.S. consumers. India’s vaunted cellphone market is dominated by inexpensive Chinese brands like Xiaomi. Indians bought fewer than six million iPhones in 2021. Chinese bought about 50 million. Starbucks operates more than 6,000 stores in China, but only about 300 in India.

Riaz Haq said…
Sadanand Dhume
Contrary to all the hype, India’s market for consumer goods remains very small. The Chinese buy about 8X more iPhones and nearly 100X more BMWs than Indians. Starbucks has 20X as many outlets in China as in India. [My take] v

Sadanand Dhume
This column has set off a mini firestorm here, so let me quickly respond to some of the objections. First, people point out that obviously China is a larger market than India. After all, it’s a larger economy. Chinese GDP in 2021: $17.73T. Indian GDP: $3.18T. 1/n

Sadanand Dhume
But this doesn’t refute my central point—that contrary to popular belief India’s market is small by global standards. We should ask how China pulled so far ahead. In 1990 Chinese GDP ($360b) was similar to Indian GDP ($321b). Now China’s economy is 5.6X larger than India’s. 2/n

Sadanand Dhume
Over the past decade, the gap between China and India has not shrunk. It has grown. In 2012, the Chinese economy was 4.7X larger than India’s. 3/n

Sadanand Dhume
Moreover, as I show in my piece, mere GDP figures are misleading. For many consumer goods, the gap between the Chinese market and the Indian market is LARGER than the gap between Chinese and Indian GDP. 4/n

Sadanand Dhume
Now to the second major objection: “Don’t talk about Starbucks, iPhones and Netflix subscriptions. These are luxury goods.” My response: The fact that they are luxury goods in India proves my point. If Indians had more disposable income they would not be seen as luxury goods. 5/n

Sadanand Dhume
Or take cars, a middle class good in much of the world. In 2021, the Chinese bought 26.3m cars. Indians bought 3.7m cars. The Chairman of Maruti Suzuki recently pointed out that it could take 40 years for the Indian car market to catch up with China’s. 6/n

India will take 40 yrs to draw level with China's car penetration: Bhargava
As a result, the small car market has been shrinking as two-wheeler customers shelve or delay plans to upgrade to a four-wheeled drive
Riaz Haq said…
India's nominal GDP growth is likely to fall in 2023-24, hurting tax collections and putting pressure on the federal government to reduce the budget gap by cutting expenses ahead of national elections in 2024.

Nominal GDP growth, which includes inflation, is the benchmark used to estimate tax collections in the upcoming budget to be presented on Feb. 1. It is estimated to be around 15.4% for the current financial year.

At least four leading economists expect nominal GDP growth to come in between 8% and 11% as inflation slows and real GDP growth eases from an estimated 7% this year, when pandemic-related distortions and pent-up demand pushed up growth rates.

A lower tax revenue will limit the government's ability to spend and support the economy as the country heads to national elections in 2024. It will also strain efforts to bring down the fiscal deficit towards the medium-term target of 4.5% of GDP by 2025/26.
Riaz Haq said…
Saudi Arabia is considering providing up to $11 billion to #Pakistan, a potential lifeline to a country facing default. #Qatar and #UAE are likely to join #SaudiArabia for up to $22 billion package of #loans and #investments for the country.

ISLAMABAD, Pakistan—Saudi Arabia said Tuesday that it was considering providing up to $11 billion to Pakistan, a potential lifeline to a country facing default.

The United Arab Emirates and Qatar in recent months have said they might also offer help to Pakistan, with potential loans and investments from Gulf nations now totaling at least $22 billion after the latest announcement from Riyadh. Gulf countries have said they could extend a similar level of support to Egypt, which is also struggling economically.

The support from Saudi Arabia could strengthen Pakistan’s hand in negotiating a restart to a stalled bailout from the International Monetary Fund. Islamabad has so far been unwilling to agree to the IMF’s terms for a deal, which include raising electricity and gasoline prices and increasing taxes.

The country’s foreign-currency reserves are fast running out, with financial markets hoping that the IMF program can be put back on track within days.

Pakistan has only around $4.5 billion in official foreign-currency reserves, financial analysts estimate. In January and February this year it is due to repay debt of $6.4 billion, according to figures from the central bank. By December, it must repay a further $12.8 billion, according to the central bank.

Saudi Arabia said Tuesday that it would study increasing its investment plans for Pakistan to $10 billion from $1 billion and would also study raising its loan deposit with Pakistan’s central bank to $5 billion from the current $3 billion, “confirming the Kingdom’s position supportive to the economy of the Islamic Republic of Pakistan and its sisterly people.”

The news followed a visit by Pakistan’s new army chief, Gen. Asim Munir, to Saudi Arabia, where he met Crown Prince Mohammad bin Salman. In the meeting, “they reviewed bilateral relations and the ways of enhancing them,” Riyadh said Monday.

Pakistan is a close partner to Saudi Arabia, including providing soldiers for guarding sites and training Saudi troops. Millions of Pakistanis work in Saudi Arabia.

Pakistan has also drawn in recent months on its other close allies, in the Gulf and China, as it struggles to repay loans taken out over the last decade.

Pakistani Prime Minister Shehbaz Sharif will visit the U.A.E. later this week, and Islamabad hopes his hosts will roll over a $2 billion loan due to mature shortly and provide additional financing. The U.A.E. pledged last year to invest around $2 billion in Pakistan. Qatar has said it would invest $3 billion in Pakistan.

None of the Gulf nations’ investment plans, mostly likely to involve the purchase of state-owned enterprises, have so far materialized. Saudi Arabia has also floated the idea of building a large oil refinery in Pakistan.

China has provided a $4 billion loan deposit with Pakistan’s central bank. Around a third of Pakistan’s debt is held by Beijing. In recent years, Beijing has carried out a multibillion-dollar infrastructure-building program in the country, a showcase for its global Belt and Road Initiative, which seeks to spread Chinese influence through large construction projects.

There are few ready investment opportunities in Pakistan for Gulf nations, while its cash needs are immediate, said Samiullah Tariq, head of research at Pakistan Kuwait Investment Company, a local financing group. Despite the Saudi announcement, Pakistan still needs the IMF, he said.

“There is a liquidity crunch,” said Mr. Tariq. “We need the money right away.”
Riaz Haq said…
World Bank Cuts 2023 Global Growth Projection as Inflation Persists
China and Ukraine inject uncertainty into world economy

The forecast growth rate only narrowly keeps the global economy out of recession territory. The international development organization cited a coalescence of high inflation, rising interest rates, lower investment and Russia’s invasion of Ukraine as threats to growth, along with pandemic-related disruptions in China and stress in its real-estate sector.

“Global growth has slowed to the extent that the global economy is perilously close to falling into recession,” the World Bank said in its latest report on global economic prospects. World Bank President David Malpass told reporters Tuesday he is “deeply concerned that the slowdown may persist.”


“Inflation won’t quite go down the way people expected,” Mr. Dimon said. “But it will definitely be coming down a bit.”

Some economists have projected that both the U.S. and parts of Europe could slip into a recession for a portion of 2023. A global recession, defined as a contraction in annual global per capita income, is more rare because China and emerging markets often grow faster than more developed economies. Essentially the world economy is considered to be in recession if economic growth falls behind population growth.

For all of 2023, the World Bank forecasts U.S. gross domestic product will increase 0.5% from the prior year, and expects no growth for the eurozone. The bank predicts China’s GDP will increase 4.3% in 2023 from the prior year, an uptick from an estimate of 2.7% growth last year. Emerging market and developing economies are projected to expand 3.4%, a steady rate of growth from 2022’s expansion.

Russian GDP is forecast to contract 3.3% after falling 3.5% in 2022, as sanctions continue to weigh on spending and investment, the bank said.

Elevated inflation is keeping pressure on global central banks to tighten monetary policy, which subsequently slows investment and the broader economy.

The World Bank called on global central banks to remain alert to the risk that aggressively tightening monetary policy to fight inflation could spill across borders. The new report called for discussions between central bankers to “help mitigate risks associated with financial stability and avoid an excessive global economic slowdown in the pursuit of inflation objectives.”

Federal Reserve Chairman Jerome Powell, speaking in Stockholm Tuesday, reiterated the central bank’s commitment to bringing down inflation, even though he said interest-rate increases could fuel political blowback.

“Price stability is the bedrock of a healthy economy and provides the public with immeasurable benefits over time,” Mr. Powell said. “But restoring price stability when inflation is high can require measures that are not popular in the short term as we raise interest rates to slow the economy.”

Central banks rapidly raised interest rates last year to combat high inflation, and are expected to fine-tune their approach this year as rates reach levels that are likely to weigh on economic growth. In the U.S., the labor market remained strong through 2022’s end, suggesting the Federal Reserve rapid rate rises haven’t yet significantly cooled demand.


The World Bank has previously said that developing countries have amassed high levels of debt that could be difficult to repay as the global economy slows and interest rates rise.

“Further adverse shocks could push the global economy into yet another recession,” the report said, adding that “small states are especially vulnerable to such shocks because of the reliance on external trade and financing, limited economic diversification, elevated debt, and susceptibility to natural disasters.”

Riaz Haq said…
Bilal I Gilani
(Pakistan) Ministry of Finance has created this proxy indicator for growth of economy that they update every month ( given GDP can't be calculated every month )

The MEI growth rate topped just before VONC

Since then it's fallen and last month it was negative meaning GDP contracted

December 2022


Most of the high frequency indicators
showing the signs of lower growth since
the start of the current FY as the
economic situation is faced with severe
headwinds both at global and domestic
ends. These are reflected in the MEI
which continues to remain on a lower
path of economic expansion. However,
the Government is taking all possible
measures to counter the downside risks
and supporting the incomes of the most
needed as well as crucial sectors of the
economy. As a result, contraction or
recession as of yet been avoided.


During January-November 2022 Bureau
of Emigration and Overseas Employment
has registered 762,767 emigrants and
71055 emigrants during November, 2022
for overseas employment in different
According to WHO, cases of malaria,
cholera, acute watery diarrheal diseases,
and dengue fever are declining in most of
the flood-affected districts. Overall,
malaria cases have reduced to around
50,000 from over 100,000 confirmed
cases in early October. Malaria cases
have declined by 25% in Balochistan, 58%
in Khyber Pakhtunkhwa (KP) and 67% in
Sindh provinces. However, high malaria
and cholera cases are still being reported
in some pocket districts in Sindh and
Balochistan where standing water
remains. In November 2022, around 70
suspected cases of Diphtheria were
reported from the flood-affected
provinces of KP, Sindh, and Punjab.
There are about 1.6 million children with
Severe Acute Malnutrition (SAM) across
all the flood-affected districts who need
treatment with Ready to Use Therapeutic
Food (RUTF). About 400,000 of these
children are in the 34 Government High
Priority Districts (GHPD). Bridging the
nutrition budget gap for an aggressive
sector-wide response is therefore very
critical. (OCHA, Flood situation report on
Pakistan, December, 06, 2022).

Riaz Haq said…
UAE pledges $3bn loan to help cash-strapped ally Pakistan
The existing loan of $2bn will be topped with an additional loan of $1bn

The United Arab Emirates is pledging a $1bn loan to cash-strapped Pakistan and also agreed to roll over an existing loan of $2bn in a boost to the South Asian nation grappling with an economic crisis, according to Pakistan prime minister’s office.

The announcement came after Pakistani Prime Minister Shehbaz Sharif held talks with UAE President Sheikh Mohamed bin Zayed Al Nahyan in the capital Abu Dhabi on Thursday on his third visit to the Gulf country after taking office last April.

The two leaders “agreed to deepen the investment cooperation, stimulate partnerships and enable investment integration opportunities between the two countries,” a PMO statement said.

Sharif has been struggling to put the economy on track since taking office, with his first finance minister Miftah Ismail resigning abruptly last September.

Islamabad is seeking financial aid from its close allies such as Saudi Arabia and China, besides the UAE as it negotiates for the next tranche of loans from the International Monetary Fund (IMF).

Ismail told Al Jazeera that the decision to roll over the fund is “great news to Pakistan”, and the announcement was seen by some analysts as a much-needed relief to the country which has seen its central bank’s foreign reserves deplete to less than $4.5bn, covering less than a month of imports.

Ammar Habib Khan, an Islamabad-based economist, said that the additional funding would provide timely support to Pakistan’s precarious economy.

On Wednesday, the World Bank slashed the gross domestic product (GDP) growth projections to 2 percent. The dire economic situation has forced the government to resort to extreme steps, such as closing malls and restaurants early.

“This funding will provide some support to Pakistan to manage its imports. However, to get out of the crisis, it does need more injection of dollars, necessitating continuation of the International Monetary Fund programme,” he told Al Jazeera.

Pakistan has struggled to convince the IMF to release the next tranche of $1.1bn loans, which has been pending since September on account of deadlock between the two parties.

Riaz Haq said…
Pakistan: Five major issues to watch in 2023
Madiha Afzal

Politics will likely consume much of Pakistan’s time and attention in 2023, as it did in 2022. The country’s turn to political instability last spring did not end with a dramatic no-confidence vote in parliament last April that ousted then Pakistani Prime Minister Imran Khan from office. Instability and polarization have only heightened since then: Khan has led a popular opposition movement against the incumbent coalition government and the military, staging a series of large rallies across the country through the year.

Pakistan’s economy has been in crisis for months, predating the summer’s catastrophic floods. Inflation is backbreaking, the rupee’s value has fallen sharply, and its foreign reserves have now dropped to the precariously low level of $4.3 billion, enough to cover only one month’s worth of imports, raising the possibility of default.

A “monsoon on steroids” – directly linked to climate change – caused a summer of flooding in Pakistan so catastrophic that it has repeatedly been described as biblical. It left a third of the country under water – submerging entire villages – killed more than 1,700, destroyed homes, infrastructure, and vast cropland, and left millions displaced.

The Pakistani Taliban (or TTP), the terrorist group responsible for killing tens of thousands of Pakistanis from 2007 to 2014, have been emboldened – predictably so – by a Taliban-ruled Afghanistan, and once again pose a threat to Pakistan, albeit in a geographically limited region (for now). The group engaged in at least 150 attacks in Pakistan last year, mostly in the northwest. Because the TTP have sanctuary in Afghanistan, the Pakistani state increasingly finds itself out of options when it comes to dealing effectively with the group. The state’s negotiations with the TTP have failed repeatedly, as they are bound to, because the group is fundamentally opposed to the notion of the Pakistani state and constitution as it exists today. The Afghan Taliban have, unsurprisingly, also not proved to be of help in dealing with the TTP – and Pakistan’s relations with the Afghan Taliban have deteriorated significantly at the same time over other issues, including the border dividing the two countries.

Pakistan has a new chief of army staff as of November 29 last year. General Asim Munir replaced General Qamar Javed Bajwa, who had held the all-powerful post for six years (due to a three-year extension). The appointment of the army chief was a subject of considerable political contention last year; a major part of the reason Khan was ousted from power was his falling out with the military on questions over the appointments of top army officials.
Riaz Haq said…
Pakistan’s productivity growth averaged 1.5pc in 2010s: study

The study — titled Sectoral Total Factor Productivity in Pakistan and conducted by the planning ministry and the think tank Pakistan Institute of Development Economics (PIDE) — says that the growth of productivity is a crucial determinant of an economy’s growth that has to be pushed higher to over 3pc.


Significantly low to achieve required GDP growth of 7-8pc
• High-productivity growth sectors mostly based on services or technology


The services sector could also be more productive because of digitisation. Similarly, flexibility in technology adoption could be another factor. It is often observed that Pakistani firms in the manufacturing sector are primarily family-owned and managed, and are in general averse to modern management practices, a factor that inhibits productivity growth, the study says.


Dividing the 61 sectors into three categories — i.e., high TFP growth (above 3pc), medium to low TFP growth (between 0pc and 2.9pc), and negative TFP growth (below 0pc) — the study found that most sectors with high TFP growth are either related to services or tech.

Most sectors in the medium to low TFP growth category are in manufacturing. Two export-designated sectors, i.e. sports goods and textile composite, also feature in medium to low-growth sectors.

Most negative growth sectors are also in the manufacturing category, which captures three export-designated sectors (textile spinning, textile weaving, and leather and tanneries) amongst other salient industries such as fertiliser and automobiles.

The analysis also precipitates a trend between sectors that receive subsidies and medium to low TFP growth or negative TFP growth categories. Similarly, the export share of each of these sectors, barring the textile sector, in global exports is less than 1pc in their respective category.

According to the analysis, services have higher TFP growth on average than manufacturing. One plausible reason for this could be greater competition in services. Besides, the manufacturing sector is protected in Pakistan, which insulates them from the competition by retarding any incentive to improve efficiency.

The services sector could also be more productive because of digitisation. Similarly, flexibility in technology adoption could be another factor. It is often observed that Pakistani firms in the manufacturing sector are primarily family-owned and managed, and are in general averse to modern management practices, a factor that inhibits productivity growth, the study says.
Riaz Haq said…
Average years of schooling for 15+ population in Pakistan is expected to grow from 6 years in 2020 to 8.4 years in 2050.

Average years of schooling for 15+ population in India is expected to grow from 6.6 years in 2020 to 8.9 years in 2050.
Riaz Haq said…
Pakistan remains a lower-middle income country and will continue to be vulnerable to fluctuating energy prices, warns a UN report released on Monday.

The report also places India and Bangladesh among lower-middle-income countries despite their economic gains and urges the entire South Asian region to reduce its energy consumption. Nepal is also placed in the same category, although Afghanistan is listed among low-income countries.

The report by the UN labour agency warns that finding a decent and well-paid job will be harder in 2023 than it was in 2022, thanks to the continuing global economic downturn.

The report notes that South Asia has not been affected by the Ukraine war as it has few direct links with Russia and Ukraine. But it is “very vulnerable to the higher global commodity prices that have resulted from the conflict.”

According to this report, South Asia “remains highly vulnerable to natural disasters, for example on the flood plains of Pakistan and Bangladesh.” Countries such as Pakistan “are also increasingly held back by very high levels of energy subsidies, which weigh heavily on public finances and are failing to reduce poverty effectively.”

The report argues that recent high and volatile energy prices have shown South Asia’s vulnerability to energy imports, and underlines “a clear need to become less dependent on these imports.”

The UN labour agency predicts that the number of people unemployed around the world would rise slightly to 208 million in 2023. This corresponds to a global unemployment rate of 5.8 per cent — or 16 million people — according to the International Labour Organisation’s (ILO) World Employment and Social Outlook Trends report. Today’s economic slowdown “means that many workers will have to accept lower quality jobs, often at very low pay, sometimes with insufficient hours,” the report adds.

The UN agency notes that this already happening in Europe and other developed countries, thanks to the Ukraine war and the continued disruption of global supply chains, both of which are counteracting the robust stimulus packages implemented to ride out the Covid-19 crisis. “Real wages we project for 2022 to have declined by 2.2pc in advanced countries and of course, Europe makes up a significant proportion of advanced countries, versus a rise in real wages in developing countries,” says Richard Samans, Director of ILO’s Research Department. The report also predicts a setback to the informal economy, which will adversely affect efforts to help the world’s two billion informal workers join the formal employment sector.

As prices rise faster than wages, the cost-of-living crisis risks pushing more people into poverty, the report adds, pointing out that the trend follows significant declines in income during the Covid-19 crisis, which affected low-income groups most, in many countries. Some 214m workers live in extreme poverty today, “in other words with $1.90 a day.

From a gender perspective, the unequal development of the global jobs market continues to be concerning. There are 290 million youth who are not in employment, or in education or training and “young women are faring much worse,” the report warns.
Riaz Haq said…
and Social Outlook

South Asia has seen the strongest growth in
the region and some of the highest regional
figures in the world: 6.0 per cent in 2022 and
5.3 per cent projected for 2023 (IMF 2022b).
Exports of services from the subregion are increasing and are expected to have contributed
positively to growth in 2022 and to do so again
in 2023 (World Bank 2022g). The digital services
sector has performed particularly strongly,
whereas sectors like tourism and construction
have not recovered to pre-pandemic levels in most
of the subregion (World Bank 2022h). Originally
high growth projections for India have been revised downwards and may be so revised further,
given deteriorating global conditions and faster
than anticipated monetary tightening (IMF 2022d).
Household consumption will be held back by slow
recovery of the labour market and by high inflation
(World Bank 2022g).


At the global level, the picture is a bit more nuanced. Global labour productivity growth accelerated from 1990 until the onset of the GFEC in 2009.
This development reflected strong productivity
growth in several emerging market economies,
which more than offset the slowdown in the G7
and Organisation for Economic Co-operation and
Development (OECD) countries. Nevertheless,
even these EMDEs that enjoyed higher labour
productivity growth rates in the past are now also
subject to stagnating or even slowing productivity
growth. This stagnation began shortly after the
GFEC, as illustrated by the experiences of China
and India. Although China’s labour productivity
growth used to be significantly higher than that
of the G7 countries, it has sharply slowed down in
recent times and has done so even faster than in
the latter countries. Furthermore, the significant
increase in productivity growth between 1990
and 2010 did not occur in all EMDEs. For example,
Brazil has followed a downward path similar to that
of advanced economies, with only a temporary
upswing around the GFEC. Labour productivity
growth in EMDEs has also been more volatile and
heterogeneous since the 1980s than in advanced
economies, where the decline has been relatively
homogeneous (Dieppe 2021).


As can be seen in figures 3.2 and 3.3, the slowdown
in labour productivity growth became ubiquitous in
the past decade and is by now afflicting the entire
globe. One reason for this might be that the stagnation in advanced economies exerts a negative
effect on the productivity outlook in less developed
economies, especially at a time when the latter are
running out of policy space as a consequence of
international fiscal and monetary shocks.

Riaz Haq said…
During the year 2022 (December), 832,339 Pakistanis proceeded abroad for the purpose of employment.

Since inception of the Bureau in the year 1971, more than 10 million emigrants have been provided overseas employment duly registered with the Bureau of Emigration & Overseas Employment. During the year 2015, highest number of Pakistanis(946,571) proceeded abroad for the purpose of employment. During the year 2022 (December), 832,339 Pakistanis proceeded abroad for the purpose of employment.
Riaz Haq said…
#Japan's #demographic crisis. More retirees, fewer workers. Japan has one of the lowest #birth rates in the world, with the Ministry of #Health predicting it will record fewer than 800,000 births in 2022 for the first time since records began in 1899.

Japan’s prime minister issued a dire warning about the country’s population crisis on Monday, saying it was “on the brink of not being able to maintain social functions” due to the falling birth rate.

In a policy address to lawmakers, Fumio Kishida said it was a case of solving the issue “now or never,” and that it “simply cannot wait any longer.”

“In thinking of the sustainability and inclusiveness of our nation’s economy and society, we place child-rearing support as our most important policy,” the prime minister said.

Kishida added that he wants the government to double its spending on child-related programs, and that a new government agency would be set up in April to focus on the issue.

Japan has one of the lowest birth rates in the world, with the Ministry of Health predicting it will record fewer than 800,000 births in 2022 for the first time since records began in 1899.

The country also has one of the highest life expectancies in the world; in 2020, nearly one in 1,500 people in Japan were age 100 or older, according to government data.

These trends have driven a growing demographic crisis, with a rapidly aging society, a shrinking workforce and not enough young people to fill the gaps in the stagnating economy.

Experts point to several factors behind the low birth rate. The country’s high cost of living, limited space and lack of child care support in cities make it difficult to raise children, meaning fewer couples are having kids. Urban couples are also often far from extended family who could help provide support.

Attitudes toward marriage and starting families have also shifted in recent years, with more couples putting off both during the pandemic.

Some point to the pessimism young people in Japan hold toward the future, many frustrated with work pressure and economic stagnation.

Japan’s economy has stalled since its asset bubble burst in the early 1990s. The country’s GDP growth slowed from 4.9% in 1990 to 0.3% in 2019, according to the World Bank. Meanwhile, the average real annual household income declined from 6.59 million yen ($50,600) in 1995 to 5.64 million yen ($43,300) in 2020, according to 2021 data from the country’s Ministry of Health, Labor and Welfare.

The government has launched various initiatives to address the population decline over the past few decades, including new policies to enhance child care services and improve housing facilities for families with children. Some rural towns have even begun paying couples who live there to have children.
Riaz Haq said…
69% Pakistanis feel that their children will have a better life than them in a global Gallup International survey in 64 countries

Figure in India is 43%

The most positive country among those surveyed is Nigeria (90% minus 6%) and the most negative is Slovenia a (14% minus 53%). Among the prominent countries where GIA could poll, expectations for their children’s future are highest in Nigeria is followed by Russia (52% minus 10%), Mexico (48% minus 30%), the USA (43% minus 31%) and India (43% minus 33%).

When combining the two questions, another perspective is added. For instance, Moldova shows a total of 86 (45% saying that their live is worse life than the one of their parents plus 41% expecting a worse life of today’s children), followed in this negative ranking by North Macedonia (82: 35% negative assessments plus 47% negative predictions), Afghanistan (81), Syria and Italy (78), etc.

Most of the countries are still positive on both questions, but if one looks for instance for countries with both above 50% positive answers, Nigeria stands out with 171 (81% positive for today plus 90% positive for tomorrow), followed by Kosovo (162), the United Arab Emirates (150), Ghana (141), Pakistan (134), etc.

Findings are proved, confirming that developing parts of the world share more hope. National and political peculiarities leave their footprint but in general is seems that the closer the war and troubles are, the worse are the answers on both issues – as expected.


Every second citizen (51%) of the world believes that their life is better than that of their parents. The other half of the people asked is equally divided between those who assess a worse life (23%) and those who find it the same (23%). 3% could not answer. Satisfaction with the living standard is a key factor for people to believe that they have a better life than their parents. But in some rich regions like Europe this is not so valid.

Expectations for the life of today’s children are predominantly good as well but lower than the comparison of own life to the life of the previous generation – 44% are expecting a better life for today’s children in comparison to our lives, 28% expecting a worse life, 20% expecting about the same and 8% not responding. Aged people are less sure about the better future of the next generation. More money unsurprisingly seems to result in more confidence in the future on a personal level, but on a national level countries that experience or used to experience difficulties are the ones to believe stronger in better future for the next generation. Unsurprisingly again.
Riaz Haq said…
The current population of Pakistan is 232,163,234 as of February 15, 2023, based on interpolation of the latest United Nations data. The population of Pakistan is projected at 225,199,937 or 225.200 million as of July 1, 2021. The total population in Pakistan is projected at 220,892,340 or 220.892 million people for the year 2020. Pakistan ranks number 5th in the world by population in the list of 235 countries/territories. Pakistan is ranked 4th among 51 countries in Asia.

Pakistan's population will be increased year by year. The Pakistan population is projected to reach 262.96 million in 2030 and increase further to 338.01 million in 2050 and 403.10 million by 2100. Pakistan accounts for 2.9 percent of the world population. However, its global share will be increasing by 1.5% in 1950 and is projected to increase at 3.7% by 2100.

Pakistan was at 14th position globally in 1950, and its rank is projected to decline at 5th in 2100.
Riaz Haq said…
What are the top 5 things Pakistan must do for long term improvement in its economy?

1. Incentivize domestic savings

2. Prioritize investing in export oriented sectors

3. Broaden tax base with agriculture, service sector income

4. Incentivize documentation of economy

5. Ensure political stability/security for investors

Riaz Haq said…
Age dependency ratio is the ratio of dependents--people younger than 15 or older than 64--to the working-age population--those ages 15-64. Data are shown as the proportion of dependents per 100 working-age population.

This age dependency ratio in Pakistan is 70%, 48% each in Bangladesh and India, according to the World Bank.


while a number of previous researchers who focused on labor productivity were mostly interested in demographic changes in the workforce, we are more interested in the age distribution of the whole population, specifically, the old and youth dependency ratios (or the old and youth population shares). For example, Feyrer (2007) emphasizes that the share of cohorts in its 40s contributes most to the aggregate labor productivity, and Aiyar, Ebeke, and Shao (2016) find that the workforce share aged 55–64 years negatively affects labor productivity growth.

we add the initial per capita GDP as a regressor and report panel regression results with country as well as period fixed effects.11,12 In the regressions that use old and youth dependency ratios as regressors (Table 3-1), the coefficients of the initial GDP per capita are also statistically significant in columns (1), (2), (4), and (8). Overall, the results are similar to those reported in Table 2-1, where the initial per capita GDP is not included. In column (1) of Table 3-1, all the coefficients of the old and youth dependency ratios are statistically significant with negative signs; the estimated coefficients of the old dependency ratio are also statistically significant in columns (5), (6), and (8). The estimated coefficient is slightly smaller in absolute value in column (1): An increase in the old dependency ratio by 0.01 decreases the GDP per capita growth rate by 0.16 percentage points. Again, the coefficient of the old dependency ratio in column (1) is almost the same as the sum of the coefficients in columns (5), (6), and (8) where they are statistically significant. In fact, the negative effect of aging on GDP per capita growth is more than fully explained by its negative impact on TFP growth: An increase in the old dependency ratio by 0.01 decreases the TFP growth rate by 0.18 percentage points. It also decreases the share of working age population by 0.02 percentage points, but this is more than nullified by the 0.048 percentage point increase in the labor participation rate.
Riaz Haq said…
GDP Growth Rate in Pakistan averaged 4.92 percent from 1952 until 2018, reaching an all time high of 10.22 percent in 1954 and a record low of -1.80 percent in 1952.

Pakistan is one of the poorest and least developed countries in Asia. Pakistan has a growing semi-industrialized economy that relies on manufacturing, agriculture and remittances. Although since 2005 the GDP has been growing an average 5 percent a year, it is not enough to keep up with fast population growth. To make things even worst, political instability, widespread corruption and lack of law enforcement hamper private investment and foreign aid.,of%20%2D1.80%20percent%20in%201952.
Riaz Haq said…
#China blames ‘certain developed country’ (reference to #US) for #Pakistan’s #economic crisis. US policy is "the main reason behind the financial difficulties of a large number of developing countries including Pakistan" #Ukraine️ #Russia #sanctions

In an apparent reference to the United States, a Chinese Foreign Ministry spokesperson on Thursday said that the financial policies of a ‘certain developed country’ were the main reason behind the financial difficulties of a large number of developing countries including Pakistan and called on concerted efforts of all parties to play a constructive role in the economic and social development of the country.

“It must be pointed out that the financial policy of a certain developed country is the main reason behind the financial difficulties of a large number of developing countries including Pakistan,” Mao Ning said while responding to a question during her regular briefing held at the International Press Centre (IPC) in Beijing.

She said that the West-led commercial creditors and the multilateral financial institutions were the basic creditors for developing countries and called on concerted efforts of all parties to play a constructive role in the economic and social development of Pakistan.
Riaz Haq said…
Is #India ready to take #China’s place in global #economy? That’s just wishful thinking. India’s modest economic size, challenging #investment environment and substandard #infrastructure are major deterrents to fruitful collaboration. #Modi #Hindutva

by Sameer Basha

India has been increasingly viewed as a natural ally to countries like Australia, which see it as an economic and military counterweight to China. They believe the best way for this to happen is through foreign direct investment into the country, to allow for a gradual transition of enterprises from China to India.
In its 2022 Investment Climate Statement on India, the US State Department called the country “a challenging place to do business” and highlighted its protectionist measures, increased tariffs and an inability to adjust from “Indian standards” to international standards.
The 2023 Index of Economic Freedom ranks India 131st in the world and 27th out of 39 economies in the Asia-Pacific region. The Indian government places equity limits on foreign capital in some sectors of the economy. In these sectors, according to the government’s circular of its FDI policy, beyond the cap imposed on foreign ownership, the entity must be “owned by/held with/in the hands of resident Indian citizens and Indian companies, owned and controlled by resident Indian citizens”.
In addition, ambiguities in the tax code have meant companies like Vodafone, Cairn Energy and GE Capital have found themselves in the cross hairs of tax authorities, putting into question India’s maturity as an FDI hub.
Such actions have seen India’s FDI inflows, as a share of the global total, fall from 3.4 per cent to 2.8 per cent between 2019 and 2021, whereas China’s share has have risen from 14.5 per cent to 20.3 per cent. In recent years, companies like Harley-Davidson and the Royal Bank of Scotland have either downsized or exited India, with German retailer Metro AG selling its operations after two decades in the country.
When one compares the relative size of their economies, China had a nominal gross domestic product of US$17.7 trillion in 2021, while India’s was US$3.2 trillion. India invests only 30 per cent of its GDP, compared with 50 per cent for China; and 20 per cent of its economy comes from manufacturing, as opposed to 30 per cent of China.
Investing in a domestic network of roads, airports, seaports and rail lines, as well as streamlining FDI regulations, allows China to move its products from factories to consumers efficiently, making it an attractive prospect for investment. That is not to mention the world-class infrastructure that has transformed the urban landscapes of both old and new cities within the country.
Despite India’s economic progress, poverty is still a defining feature in its sprawling metropolises. Former Reserve Bank of India governor Raghuram Rajan has also weighed in on the India-China competition, stating: “The argument that India will replace China is very premature as India is a much smaller economy as of now.”
Unfortunately, India is not currently in a place to deliver on the expectations placed on it by countries like Australia, which remain stuck in a geopolitical gambit with China. Simply banking on its large population is a fickle way of viewing the options amid a decoupling from China’s economy. India is still decades away from realising its true potential.
The two countries’ goals also differ. China is transforming itself into a technologically driven economy in order to exceed the potential of the US. In contrast, India is attempting to position itself as a market-driven economy utilising its large population as a manufacturing base to compete with China.

Riaz Haq said…
Digital census process continues smoothly: PBS

ISLAMABAD: The process of the 7th Population and Housing Census, being conducting digitally for the first time in the country’s history, has been going on smoothly all across the country, the Pakistan Bureau of Statistics (PBS) reported here on Thursday.

“The overall progress and speed of the census process is very encouraging and satisfactory,” PBS said in a press statement issued here.

The process includes an option for self-enumeration, which was made available from February 20, 2023, till March 10, 2023, and field operations of house listing and enumeration commenced from March 01, 2023, that will continue till April 4, 2023.

Conducting a census digitally ensures transparency, data-driven procedures, real-time monitoring of progress through geo-tagging using GIS systems, and wider acceptability of census results, said PBS press statement.

It said structures were listed from March 1st to March 10, 2023, during which all the residential and economic units were geotagged along with the classification of economic activities as per international standards.

It said, the self-enumeration portal was very well received by people who have enumerated themselves using the portal launched and this method was optional.

Currently, the final phase of the census i.e. enumeration is ongoing starting from March 12, 2023, and would continue till April 4, 2023. In this phase, the data about household members and their demographic characteristics, various Socio-Economic Indicators, as well as Housing characteristics, are being collected.

PBS technical team is analyzing and assessing the data and trends on a day-to-day basis to ensure the quality of the data and progress in identified 291 blocks all over Pakistan. Physical verification and digital monitoring are being used for quality assurance.

PBS has established 495 Census Support Centers (CSC) at the Census District level and 495 Census Support Centers (CSC) at the tehsil level where over 1,095 IT experts of NADRA and PBS team are available 24/7 for technical assistance and facilitation of field staff.

The control room has been established at the CSC level which facilitates census field staff during field operation and for this purpose, NADRA technical teams are available to redress all IT-related issues.

A call center is operating 24/7 for facilitation, assistance and suggestions through the toll-free number 0800-57574.

It said, certain quarters were spreading false and misinformation, adding information shared on the PBS website and official social media should be believed and considered.
Riaz Haq said…
Why are women in #China not having more babies despite gov't incentives? With rapidly #aging and declining #population and slowing #economic growth, China’s leaders are asking #women to have three children again, but it's too late. #economy #fertility

Fewer people might mean slower growth in China, which will be felt by the U.S. and beyond.

“They’ve now become, you know, the center of the global manufacturing superhighway and are typically the largest contributor to growth every year,” said Scott Kennedy with the Center for Strategic and International Studies in Washington D.C.

Chinese officials often credit the so-called one-child policy for preventing over 400 million births, but some analysts say China’s population would have declined regardless.

“It’s just simply a rule across all countries, that as you urbanize, and as you get a more educated female population that enters the workforce, fertility numbers fall,” Kennedy said.


The number of Chinese workers is already declining; according to the World Bank, in 2001, China had 10 workers to support one retiree.

“In 2020, that was down to five working folks for each retiree and by 2050 it’ll be down to two,” Kennedy said.

He believes China still has time to offset the effects of population decline, including by boosting productivity, increasing the retirement age and lifting restrictions on people from rural areas to freely settle in cities with their families.

“I don’t think the problem has become so severe that demography is destiny, and China is destined to radically slow down and its chances of becoming an economic superpower breaking out of the middle income trap have been dashed,” Kennedy said.

“[But] these are pretty significant challenges.”


28-year-old Joy Yu’s parents each had three siblings. As they were growing up in the 1970s, the Chinese government started to limit the number of babies born.

Government statistics show on average a woman in China went from having about three babies in the late 1970s to just one.

Four decades on, China’s leaders are asking women to have three children again, which doesn’t sit well for Yu, an only child.

“For me to give birth to three children, my future husband must be rich enough to make sure I can live well without a job. This is a big challenge,” Yu said.

Last year, China’s population dropped for the first time in six decades by 850,000. That still leaves the country with 1.41 billion people but if the decline continues, there will be multiple impacts on the economy.

China began enforcing birth limits in the late 1970s when the country was poor and there were too many mouths to feed.

In a Chinese propaganda film called the Disturbance of Gan Quan Village, the birth restrictions were justified on economic grounds.

“We should put our energy into getting rich rather than keep having children,” says one woman in the film.

She’s sitting among a group of women picking corn kernels off the cob. “Aren’t we getting poorer with each child we have,” she says. The rest of the group nods in agreement.

Chinese leaders enforced, sometimes brutally, the so-called one-child policy in 1979, just as the country was coming out of the tumultuous Cultural Revolution.

“The post-[Chairman] Mao leadership thought that economic development would be the new basis for the party’s political legitimacy and based on pseudo-scientific and demographic projections, limiting birth to one child per married heterosexual couple,” said Yun Zhou, an assistant professor of sociology at the University of Michigan.

There were exceptions. Some ethnic minority groups could have up to three children. People from rural areas could try for a second child if their first-born was not a boy. Later, if both parents had no siblings they could have two children. Starting in 2016, China raised the birth limit for everyone to two children, but there was no sustained baby bump.
Riaz Haq said…
Why Americans Are Having Fewer Babies - WSJ

The number of babies born in the U.S. started plummeting 15 years ago and hasn’t recovered since. What looked at first like a temporary lull triggered by the 2008 financial crisis has stretched into a prolonged fertility downturn. Provisional monthly figures show that there were about 3.66 million babies born in the U.S. last year, a decline of 15% since 2007, even though there are 9% more women in their prime childbearing years.

The decline has demographers puzzled and economists worried. America’s longstanding geopolitical advantages, they say, are underpinned by a robust pool of young people. Without them, the U.S. economy will be weighed down by a worsening shortage of workers who can fill jobs and pay into programs like Social Security that care for the elderly. At the heart of the falling birthrate is a central question: Do American women simply want fewer children? Or are life circumstances impeding them from having the children that they desire?


To maintain current population levels, the total fertility rate—a snapshot of the average number of babies women have over their lifetime—must stay at a “replacement rate” of 2.1 children per woman. In 2021, the U.S. rate was 1.66. Had fertility rates stayed at their 2007 peak, the U.S. would now have 9.6 million more kids, according to Kenneth Johnson, senior demographer at the University of New Hampshire.

Federal agencies are treating the slump like a temporary downturn. The Social Security Administration’s board of trustees projects that the total fertility rate will slowly climb to 2 by 2056 and hold there until the end of the century. Yet it’s been over a decade since fertility rates reached that level. Last year there were 2.8 workers for every Social Security recipient. That ratio is projected to shrink to 2.2 by 2045, roughly two-thirds what it was in 2000.

Some other developed countries are in a far deeper childbearing trough than the U.S. In South Korea, the total fertility rate hit a world record low of 0.84 in 2020 and has since sagged to 0.78. Italy’s rate slid to 1.24 last year. China’s population fell in 2022 for the first time in decades because its fertility rate has been far below the replacement rate for years. Its two-century reign as the world’s most populous country is expected to end this year when India overtakes it, if it hasn’t already.

In a recent note to clients, Neil Howe, a demographer at Hedgeye Risk Management, pointed to a World Bank report showing that the 2020s could be a second consecutive “lost decade” for global economic growth, in large part because of worsening demographics. By 2026 or 2027, he wrote, the growth rate of the working-age population in the entire high-income and emerging-market world will turn from slightly positive to slightly negative, reversing a durable driver of economic growth since the Industrial Revolution.

This shift will make the U.S. more dependent on immigration to supply enough workers to keep the economy humming. Immigrants accounted for 80% of U.S. population growth last year, census figures show, up from 35% just over a decade ago. Yet the number of young immigrant women coming to the U.S. has diminished, Johnson said, and the decline in fertility has been greatest among Hispanics.

Having fewer children has already changed the social fabric of the country’s schools, neighborhoods and churches. J.P. De Gance, president and founder of Communio, a nonprofit that helps churches encourage marriage, said that lower marriage and birth rates are one of the largest drivers of the decline in religious affiliation that’s left pews empty across the country. That matters for the whole community, De Gance said, because churches give lonely people a place to form friendships, as well as feeding hungry people and running schools that fill gaps in public education. “When that’s diminished, the entire culture’s diminished,” he said.
Riaz Haq said…
20 Largest Economies in the World by 2050: The Rising Giants

Complete List
Country Projected GDP at PPP (in trillion)
Vietnam $3.18
Philippines $3.34
South Korea $3.54
Iran $3.90
Pakistan $4.24
Egypt $4.33
Nigeria $4.35
Saudi Arabia $4.69
France $4.71
Turkey $5.18
United Kingdom $5.37
Germany $6.14
Japan $6.78
Mexico $6.86
Russia $7.13
Brazil $7.54
Indonesia $10.5
United States $34.1
India $44.1
China $58.5


In our exploration of the future, we’ve delved into the fascinating realm of global economic dynamics, forecasting the 20 largest economies by the year 2050. But if you’re eager to cut to the chase, feel free to jump straight to our top 5 predictions.

Our journey begins in the heart of London, at the headquarters of our own professional services network.

We’re proud to stand among the world’s leading accountancy firms, and in 2017, we embarked on a bold project: The World in 2050. This report was our attempt to gaze into the crystal ball of the world’s economic future, three decades down the line.

Our projections suggest a seismic shift in the global economic landscape. We anticipate the global economy will surge by 130% by 2050, with China commanding a 20% share of the world’s GDP in purchasing power parity.


Pakistan Forecasted GDP at PPP: $4.24 trillion

Pakistan, the world’s fifth most populous nation, is expected to be among the 20 largest economies in the world by 2050, driven by its youthful population. A Goldman Sachs report from December 2022 even tipped Pakistan to be the sixth largest economy by 2075.
Riaz Haq said…
Dependency ratio is the ratio of children (under 15) and retirees (65 and above)) to working age (15-64 years) people in a population. Countries with high dependency ratios tend to perform poorly relative to countries with low dependency ratios in terms of economic growth.

A recent NY Times article by Lauren Leatherby titled "How a Vast Demographic Shift Will Reshape the World" uses charts and graphics to show how the world economic landscape will change during the rest of the century.

It shows that Pakistan will join the top 10 countries with highest share of working age population and lowest dependency ratios.

Pakistan will join top 10 countries in working age population in 2050

Bangladesh is already in the top 10 working age population countries today.

Countries are categorized as having large working-age populations if people between the ages of 15 and 64, an age group commonly used by demographers, make up at least 65 percent of the total population.

Countries where at least a quarter of the population is under age 15 and where less than 65 percent of the population is working age are categorized as having a large young population. Countries are categorized as having a large old population if those age 65 and older make up more than a quarter of the population.

Unless noted otherwise, graphics include all countries with a population of at least 50,000 people.

The world’s demographics have already been transformed. Europe is shrinking. China is shrinking, with India, a much younger country, overtaking it this year as the world’s most populous nation.

But what we’ve seen so far is just the beginning.

The projections are reliable, and stark: By 2050, people age 65 and older will make up nearly 40 percent of the population in some parts of East Asia and Europe. That’s almost twice the share of older adults in Florida, America’s retirement capital. Extraordinary numbers of retirees will be dependent on a shrinking number of working-age people to support them.

In all of recorded history, no country has ever been as old as these nations are expected to get.

As a result, experts predict, things many wealthier countries take for granted — like pensions, retirement ages and strict immigration policies — will need overhauls to be sustainable. And today’s wealthier countries will almost inevitably make up a smaller share of global G.D.P., economists say.

This is a sea change for Europe, the United States, China and other top economies, which have had some of the most working-age people in the world, adjusted for their populations. Their large work forces have helped to drive their economic growth.

Those countries are already aging off the list. Soon, the best-balanced work forces will mostly be in South and Southeast Asia, Africa and the Middle East, according to U.N. projections. The shift could reshape economic growth and geopolitical power balances, experts say.

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