Strikes, road closures may cause Rs120bn daily economic loss: Aurangzeb

Federal Finance Minister Muhammad Aurangzeb has warned that strikes, sit-ins, long marches, and road closures could cause Pakistan's economy to lose around Rs120 billion each day. The estimated daily loss includes Rs86 billion from the services sector, Rs25 billion from industry, and Rs9 billion from agriculture. These disruptions could impact construction projects, finished goods, raw materials, and supply chains, especially affecting the agriculture sector due to transportation and perishable goods issues.

Aurangzeb explained that ordinary people, daily-wage workers, small shopkeepers, and small businesses would bear the immediate brunt of economic disruption. The country's economic journey was transitioning from stability towards growth, with foreign exchange reserves at $21.4 billion and the fiscal deficit at a 22-year low of 2.6% of GDP. Higher tax revenues and lower expenditure contributed to this reduction, while the current account moved into surplus after 14 years.

Remittances improved, and IT exports were projected to rise from $4.6 billion to $5.5 billion. Goods exports were also improving, maintaining the current account deficit between zero and 1% of GDP. GDP growth stood at 3.7% in the last fiscal year and was expected to exceed 4% in the current year. Large-scale manufacturing showed significant recovery with growth in July and August, and investor participation in the stock market, especially among young people, had increased.

However, Aurangzeb cautioned that the Middle East and Gulf situation posed significant challenges to global trade, causing supply-chain disruptions and higher freight and insurance costs. Recent terrorism and loss of precious lives were major setbacks, with the Pakistan Army and civil armed forces fully engaged in countering terrorism.

The minister urged the country to continue its journey towards sustainable growth, exports, and investment, with a target of $32.9 billion in goods exports for the current fiscal year, expecting a 6% growth rate. The average daily volume of goods exports was around $90 million, emphasizing that further economic disruptions could severely impact exports and economic growth.