Download Ten Year Perspective Development Plan 2001

Ten Year Perspective Development Plan 2001-11 and
Three Year Development Programme 2001-04
To provide a direction to the economy while maintaining flexibility required
in present time, the first Ten Year Perspective Development Plan 2001-11 of the
country operationalied through Three Year Development Programme was released by
the Planning Commission on 6-9-2001. The Plan is being implemented from fiscal
year 2001-02. This is a model for other countries.
2.
The Sectoral Strategies were developed after lengthy discussions at Federal
and Provincial levels. Before finalizing the Plan, Presentations to Chief Executive
were made several times in which Federal Ministers and Secretaries, Governors and
Provincial Ministers were participated.
3.
This is a completely home grown plan to visualize the required long-term
macroeconomic and sectoral growth strategies. As effective implementation is the
key, a steady movement towards 2010-11 will be vigorously pursued through
operational strategies embodied in the Three Year Development Programme, which
will roll over every year.
Objectives
4.
The key objectives of the Perspective Development Plan are:
•
Accelerating GDP growth, reduce unemployment and alleviate poverty;
•
Financing growth increasingly by Pakistan’s own resources;
•
Government to improve its income-expenditure configuration to contain
domestic borrowing;
•
Private Sector to transform a larger proportion of its saving into foreign
exchange through exports. This is to contain external borrowing;
•
Improvement in competitiveness by promoting productivity, efficiency,
and quality;
•
Build human capital base for long-term, self-reliant growth;
•
Institutionalize social capital conducive to sustainable development.
Plan Size
5.
The total size of the Plan and its distribution between public and Private
sectors is given below:
(Current Prices Rs. Billion)
Public Sector
Development
Programme
Private Sector
Total
6.
First Three
Years 2001-04
460
1,519
1,979
%
23.2
Total Ten
Years 2001-11
2,540
%
22.5
76.8
100.0
8,747
11,287
77.5
100.0
Projections for the private sector can at best be indicative, the realization of
which will depend on the continued investment-friendliness of the policy framework
in all sectors, as virtually all fields of the economy are now open to the private
initiative. The public sector will concentrate on poverty reduction and human
development. Its allocations have been planned tightly: priorities have been worked
out for the ten-year allocation of Rs.2,540 billion; Rs.460 billion have been proposed
for the first three-year period 2001-04 to initiate, accelerate and complete the priority
projects and programmes. A higher budgetary provision of Rs.130 billion further
raised to 140 billion has made for the first year, 2001-02, to front-load the
implementation of key projects and programmes in water and agriculture so as to
overcome the impact of droughts and promote rural employment, and information
technology to force productivity and generate urban employment opportunities. Rs.
134 billion have been earmarked under PSDP for the second year 2002-03 of the Ten
Year Perspective Development Plan.
Growth Rate
7.
The macroeconomic framework projects an increase in the growth rate from
the drought-related low of 2.6 per cent in 2000-01 to 4 per cent in 2001-02, takes it to
5 per cent in the medium-term i.e. by 2003-04 and then accelerates it to 6.3 per cent
by 2010-11.
Strategy
8.
A four pronged strategy has been envisaged for economic growth: (i) Gradual
acceleration in GDP growth: The overall GDP growth in real terms has been planned
to accelerate from 2.6 percent estimated for 2000-01 to 6.3 percent in 2011. This level
of growth is required to improve living standards, expand employment, generate
government revenues, and enhance exportable surplus. With population growth
assumed at 1.8 percent per annum by 2011, the envisaged growth is expected to raise
the per capita income in real terms from Rs 24,188 in 2001 to Rs 34,444 in 2011; (ii)
Maintaining the tempo of agricultural growth rate: During the past 15 years,
agriculture sector has grown, on average, at 4.2 percent per annum. Maintaining this
tempo will be essential to having a balanced growth of the economy, keeping
inflation low, and maintaining employment; (iii) Revitalizing manufacturing growth
rate: Industrial growth suffered a setback during the 90s and averaged only 4.8
percent per annum. In the long-term perspective, the objective would be to sharpen
the industrial activity and push up the manufacturing growth from 4.8 percent of the
90s, to 7.8 percent by 2011; (iv) Improvement in Productivity and Quality: This will
have to be accomplished through appropriate policies such as exchange rate, domestic
input pricing, and credit availability on the one hand, and setting up close linkages
between high value added production structure and training and HRD facilitation, on
the other hand.
Macro Economic Framework
9.
The macro economic projections upto 2011 are given below:
Growth, Structural Change and Investment
____Projections___
Benchmark
2000-01
2003-04
2010-11
Growth Rate (%)
GDP
Agriculture
Manufacturing
Services
Shares (% of GDP)
Agriculture
Manufacturing
Services
Investment ( % of GDP)
Total
Fixed
Public
Private
2.6
-2.5
7.1
4.4
5.0
3.5
6.9
5.2
6.3
4.2
7.8
6.6
25.0
15.7
52.0
23.8
16.6
52.3
21.3
18.7
52.6
14.7
13.1
2.2
10.9
16.5
14.9
2.5
12.4
20.6
19.0
3.2
15.8
External Scenario
(in Constant $ of 2001)
Trade Balance
Exports
Imports
Invisibles Balance
Current Account
Balance
(as % of GDP)
Benchmark
2001
-1304
9350
10654
350
-954
-1.6
(Million $)
Projections
2004 2011
-1015
-67
10739
16171
11754
16238
267
-539
-747
-1.1
-606
-0.6
Public Finance
(As % of GDP)
Benchmark
__Projections__
2001
2004
2011
Tax Revenue
13.5
15.4
19.9
Non-Tax Revenue
2.8
2.8
3.0
Current Expenditure
18.6
17.8
20.0
Development Expenditure
3.2
3.9
4.5
Overall Fiscal Deficit
5.3*
3.5
1.7
* Adjusted for Rs -8.2 billion on account of net lending to PSEs.
10.
Inflation rate has been assumed to be between 4-5.5 percent per annum during
the Perspective Plan period. Nevertheless, most of the projections in the Perspective
Plan have been made in real terms. The Monetary expansion is likely to range
between about 10 percent to 11 percent per annum.