Ownership Rates of Durable Goods in India and Pakistan

Ownership of consumer durables like computers, home appliances and vehicles is often seen as an important indicator of the size and health of the middle classes in emerging economies. Examples of periodic household surveys used by researchers to measure such data include NSS (National Sampling Survey) in India and PSLM (Pakistan Social and Living Standards Measurement) in Pakistan.

Durables Ownership in India and Pakistan. Source: KSBL


India-Pakistan Comparison:

Dr. Jawaid Abdul Ghani, a professor at Karachi School of Business Leadership, has recently analyzed household surveys in India and Pakistan to discover the following:

1.  As of 2015, car ownership in both India and Pakistan is about the same at 6% of households owning a car. However, 41% of Pakistani household own motorcycles, several points higher than India's 32%.

2. 12% of Pakistani households own a computer, slightly higher than 11% in India.

3. Higher percentage of Pakistani households own appliances such as refrigerators (Pakistan 47%, India 33%), washing machines (Pakistan 48%, India 15%) and fans (Pakistan 91%, India 83%).

4. 71% of Indian households own televisions versus 62% in Pakistan.

Durables Ownership Growth in Pakistan. Source: KSBL
Growth over Time:

Dr. Abdul Ghani has also analyzed household data to show that the percentage of Pakistani households owning washing machines has doubled while car and refrigerator ownership has tripled and motorcycle ownership jumped 6-fold from 2001 to 2014.

Income/Consumption Growth in Pakistan. Source: KSBL

Rapid Income Growth:

Rising ownership of durables in Pakistan has been driven by significant reduction in poverty and growth of household incomes, according to Dr. Abdul Ghani's research. Percentage of households with per capita income of under $2 per day per person has plummeted from 57% in 2001 to 7% in 2014. At the same time, the percentage of households earning $2 to $10 per day per person has soared from 42% of households in 2001 to 87% of households in 2014.  The percentage of those earning over $10 per day per person has jumped 7-fold from 1% of households in 2001 to 7% of households in 2014.

Pakistani Middle Class:

Only 5% of Pakistanis in $2-$4 per day per person income group have college degrees. But 20% of those in $4-$10 have college degrees, according to the survey results.

Pakistan Middle Class Profile. Source: KSBL

Credit Suisse Income and Wealth Data:

Average Pakistani adult is 20% richer than an average Indian adult and the median wealth of a Pakistani adult is 120% higher than that of his or her Indian counterpart, according to Credit Suisse Wealth Report 2016. Average household wealth in Pakistan has grown 2.1% while it has declined 0.8% in India since the end of last year.

Median wealth data indicates that 50% of Pakistanis own more than $1,180 per adult which is 120% more than the $608 per adult owned by 50% of Indians.

GDP Estimates Using Household Survey Data:

Pakistan's GDP calculated from consumption data in PSLM is significantly higher than the government estimates based on production data. The reverse is true of Indian GDP.

M. Ali Kemal and Ahmed Waqar Qasim, economists at Pakistan Institute of Development Economics (PIDE),  explored several published different approaches for sizing Pakistan's underground economy and settled on a combination of  PSLM (Pakistan Social and Living Standards Measurement) consumption data  and mis-invoicing of exports and imports to conclude that the country's "informal economy was 91% of the formal economy in 2007-08". 

Prominent Indian economists Abhijit V Banerjee, Pranab Bardhan, Rohini Somanathan and TN Srinivasan teaching at MIT, UC Berkeley, Yale University and Delhi School of Economics believe that India's GDP estimate based on household survey (National Sampling Service or NSS) data is about half of what the Indian government officially reports as India's GDP. 

Here's a quote from French economist Thomas Piketty's book "Capital in the Twenty-First Century" explaining his skepticism of production-based official GDP figures of India and China:

"Note, too, that the very high official growth figures for developing countries (especially India and China) over the past few decades are based almost exclusively on production statistics. If one tries to measure income growth by using household survey data, it is often quite difficult to identify the reported rates of macroeconomic growth: Indian and Chinese incomes are certainly increasing rapidly, but not as rapidly as one would infer from official growth statistics. This paradox-sometimes referred to as the "black hole" of growth-is obviously problematic. It may be due to the overestimation of the growth of output (there are many bureaucratic incentives for doing so), or perhaps the underestimation of income growth (household have their own flaws)), or most likely both. In particular, the missing income may be explained by the possibility that a disproportionate share of the growth in output has gone to the most highly remunerated individuals, whose incomes are not always captured in the tax data." 

Who is Dr. Jawaid Abdul Ghani?

The PSLM household data cited in this blog post is taken from a recent presentation made by Dr. Jawaid Abdul Ghani at the Karachi School of Business and Leadership (KSBL) where he teaches. KSBL has been established in collaboration with  Cambridge University's Judge Business School. Prior to his current faculty position, Dr. Abdul Ghani taught at MIT's Sloane School of Management and Lahore University of Management Sciences (LUMS). He has a computer science degree from MIT and an MBA from Wharton Business School.

Summary:

Pakistan has managed to significantly reduce poverty and rapidly grow its middle class since 2001 in spite of major political, security and economic challenges. The foundation for the rise of the middle class was laid on President Musharraf's watch by his government's decisions to invest in education and infrastructure projects that led to the expansion of both human and financial capital. My hope is that the continued improvement in security situation and implementation of China-Pakistan Economic Corridor (CPEC) related projects will bring in higher long-term investments and accelerate Pakistan's progress toward prosperity for all of its citizens.

Related Links:

Haq's Musings

Credit Suisse Wealth Report 2016

Pakistan: A Majority Middle Class Country

Karachi School of Business and Leadership

State Bank: Pakistan's Actual GDP Higher Than Officially Reported

College Enrollment in Pakistan

Musharraf Accelerated Development of Pakistan's Human and Financial Capital

China-Pakistan Economic Corridor

Comments

Riaz Haq said…
In India, washing machines top computers in popularity
A majority of Indian households own a TV while 29% own a refrigerator, according to the ICE 360° survey

http://www.livemint.com/Specials/bhWpWqj3AFuETVdsC05fdM/In-India-washing-machines-top-computers-in-popularity.html

Fresh data from a large-scale nationally representative survey conducted this year (2016) shows that the washing machine has become a more popular household asset than the computer in India. The ‘Household Survey on India’s Citizen Environment & Consumer Economy’ (ICE 360° survey) shows that 11% households own a washing machine while only 6% own a computer or a laptop. The survey covering 61,000 households is among the largest consumer economy surveys in the country.

The survey shows a drop in the proportion of computer-owning households compared to the 2011 census, when nearly 10% households reported having either a computer or a laptop (the census did not report data on washing machines). The ICE 360° survey also shows that 10% households reported having an Internet connection, 1% lower than the proportion of households with a washing machine. But the proportion of households where at least one household member reported accessing the Internet (including those who accessed the Internet at work) is significantly higher at 22%.


The survey also shows that a large majority of Indian households owns a TV today. The 2011 census had showed that 47% households have a TV set. That proportion has increased to 65%, according to the ICE 360° survey. As TV becomes a mass market product, the refrigerator may be turning into the kind of aspirational product that the TV once used to be. A majority of the top quintile owns a refrigerator. A majority of the salaried class also owns a refrigerator. Nationally, 29% households own a refrigerator.

Riaz Haq said…
Brisk sales of appliances in Pakistan

https://www.dawn.com/news/1174131

The home appliances business is thriving and key market players expect consumer demand to surge as households generally replace their old appliances with newer models.

According to an assessment, almost all concrete houses in first-, second- and third-tier cities, from posh areas to shanty settlements, have fans. The reach of the television is said to be as high as 80pc. In major cities, almost 60pc of households are said to have fridges and washing machines, on average.

And China is reaping the benefit of the changing lifestyle in Pakistan, as the bulk of key components used in home appliances are imported from the Asian giant, leading companies in the business confirmed.

According to the Survey, “In electronic products, air conditioners, deep freezers, electric motors, storage batteries and refrigerators were main contributors (to LSM), growing by 36.12pc, 83.03pc, 20.1pc, 3.2pc and 3.6pc respectively”.

According to latest PBS figures released on March 24, the production of home appliances — including refrigerators, TV sets, air conditioners and sewing machines — rose 10pc to 1.2m units during July-January 2014-15. The production of the most popular products — fridges and deep freezers — was up 15pc to 0.8m units, against 0.7m units during the same period of the previous year.

And the production of television sets — the second most popular category in electronic goods — grew 5pc to 57,000 units during July-January. But air conditioner and sewing machines declined 6pc and 1pc over the period.

Riaz Haq said…
What's the reality behind all the praise for Pakistan's economy?
There is no doubt that Pakistan’s economy has seen qualitative shifts towards increased marketisation and commodification in the past two decades. However, the claims extrapolated from these shifts require further scrutiny

http://www.trtworld.com/opinion/whats-the-reality-behind-all-the-praise-for-pakistans-economy-306535


Underpinning much of the coverage is a set of core statistics: the country’s GDP growth rate crossed 4 percent last year, and is expected to surpass 5.5 percent in 2017. The stock market rose by 46 percent in 2016, and is now in line for an upgrade to emerging market status by the middle of 2017. Foreign exchange reserves have grown to a record high of $20 billion, while more inflows are expected via a number of big-ticket energy and transit projects under the $57 billion China Pakistan Economic Corridor (CPEC). Finally, measurements by the United Nations Development Program (UNDP) show multidimensional poverty declining from 55 percent of all households in 2005 to 38 percent in 2015.

Beyond macroeconomic indicators, another factor that has received considerable attention in recent coverage is the country’s growing middle class. One recent piece, published in the Wall Street Journal, cited this burgeoning middle class as the primary fuel behind the twin boon of democratic stability and economic growth.

Depending on the definitions used, Pakistan’s middle class is estimated to be anywhere between 5 to 35 percent of the population. Using income-based methods, the Pakistan Institute of Development Economics (PIDE) finds that approximately 55 million people earn between 75 to 125 percent of the overall median income. Credit Suisse, on the other hand, estimates that 9.7 percent of Pakistan’s adult population, around 7 million people, possess wealth between $10,000 and $100,000. By this measure, Pakistan’s would be the 18th largest middle-class in the world.

In the absence of reliable data on changes in the income distribution, a number of other metrics serve as a useful way to gauge Pakistan’s "middle-class revolution". One of these is the ownership of consumer durables: today, approximately 40 percent of all households own a motorcycle while nearly 60 percent own a television, up from 4 and 20 percent respectively in the early 1990s. Similarly, household ownership of washing machines and refrigerators is now in the mid-40s as well, up from under 20 percent just two decades ago. This expanding market for sale of household appliances, along with its untapped potential, has not gone unnoticed by foreign investors. Late last year, the Turkish consumer goods giant Arcelik entered the Pakistani market through a $240 million buy-out of a local white goods manufacturer.

Similar expansion at the upper-end of the consumer market can be gauged from the sale of passenger cars, which rose from 40,000 units in 2000 to nearly 200,000 in 2016. A considerable portion of this market is now financed through credit, as banking outlays for the purchase of automobiles hit an all-time high of $1.1 billion in 2016, up from $415 million in 2012.

Beyond descriptive statistics, the spatial and visual transformation in Pakistan’s expanding urban centres tell a similar story. Private schools and colleges have cropped up everywhere, offering instruction in the English language as their contribution towards personal enrichment and upward mobility. Similarly, new real estate developments in housing and retail can be found selling profitability and modern amenities to investors and consumers respectively. Advertising campaigns for these projects often rely on some variant of an idealised western lifestyle, clearly playing on, and perhaps in part shaping, the aspirations of a vociferous market.
Riaz Haq said…
#Smartphone sales take off in #Pakistan. 40 million owned today. http://bit.ly/2pS6WTY via @techjuicepk

As smartphones flood into the country, more and more Pakistanis switch from feature phones to smartphones. Those who have not yet taken them up haven’t done so majorly due to safety concerns, and not for the lack of inclination towards the new trending gadgets. The share of smartphone continuously rises even more in a market equipped with 3G and 4G, that have 35 million mobile data subscribers.

While Apple’s iPhone and the more feature-rich models of Samsung have been favorites among technology enthusiasts and high-income group consumers, low-end models Huawei, Samsung and QMobile are popular because of the reasonable price range they offer. QMobile dominates both smartphone and feature phone markets and holds over 50 % of the smartphone market segment. Last year, Samsung had 20.5% of the smartphone market share while Huawei increased its share from 7.3 % to 8.9%.

The prevalence of smartphones among people-powered the growth of businesses like Careem, which, without owning a single vehicle, has become a successful business worth 1 billion US dollars. Smartphones are the market square for businesses today. As they offer technology connectivity, entrepreneurs expect them to be a selling medium for products and ideas.

The flourish in smartphones in these recent years has seen to it that Pakistani mobile users do not see the mobile phone as a mere communication device anymore. Besides connecting people, phones are now connecting technologies. The arrival of smartphones has meant that your phone is now a camera, as well as a photo editor, a document scanner, weather forecaster, a tiny portable workstation and much more.

Additionally, thanks to new online business and medical technology solutions, this pocketable device promotes health and security, and make traveling, eating, paying bills more enjoyable and simpler experiences. Smartphones have given urban life in the fast lane a boost and profited start-ups and business ventures. It is no wonder that, along with our dependence on these devices, expectations we have from them are rising. Users expect them to provide convenience and solutions in every domain, from health, recreation, and logistics to simplifying daily cumbersome tasks.

IDC expects smartphones to overshadow feature phones by end of 2017, even though smartphones currently make up 31% of the mobile market. It seems a huge chunk of our population is steadily adopting to smarter phones. Pakistan is also estimated to have 17 million new mobile subscribers by 2020, TechJuice reports from the GSMA’s 2017 Mobile Economy Report. These trends are indications of increasing technology awareness in our nation. As mobile and smartphone users increase in different income groups, we can expect changes in the lifestyle of entire communities. More and more people will have access to the convenience and technology solutions offered by and through smartphones. The increased number of users bring business opportunities for entrepreneurs that want to use this medium to access a wide base of customers.
Riaz Haq said…
Pakistan Social And Living Standards Measurement
BRIEF ON PAKISTAN SOCIAL & LIVING STANDARD MEASUREMENT (PSLM) SURVEY 2004-15

The PSLM Project is designed to provide Social & Economic indicators in the alternate years at provincial and district levels. The project was initiated in July 2004 and will continue up to June 2015. The data generated through surveys is used to assist the government In formulating the poverty reduction strategy as well as development plans at district level and for the rapid assessment of program in the overall context of MDGs. As such this survey is one of the main mechanisms for monitoring MDGs indicators. It provides a set of representative, population-based estimates of social indicators and their progress under the PRSP/MDGs. For Millennium Development Goals (MDGs), UN has set 18 targets for 48 indicators for its member countries to achieve by 2015. Pakistan has committed to implement 16 targets and 37 indicators out of which 6 targets and 13 indicators are monitored through PSLM Surveys. The PSLM surveys are conducted at district level and at Provincial level respectively at alternate years. PSLM District level survey collects information on key Social indicators whereas through provincial level surveys (Social & HIES) collects information on social indicators as well as on Income and Consumption while in specific sections also information is also collected about household size; the number of employed people and their employment status, main sources of income; consumption patterns; the level of savings; and the consumption of the major food items. However, Planning Commission also uses this data for Poverty analysis.

An other important objective of the PSLM Survey is to try to establish the distributional impact of development programs; whether the poor have benefited from the program or whether increased government expenditure on the social sectors has been captured by the better off.

The sample size of PSLM surveys district level is approximately 80000 households and approximately 18000 at Provincial level.

Main Indicators

Indicators on Demographic characteristics, Education, Health, Employment, Household Assets, Household Amenities, Population Welfare and Water Supply & Sanitation are developed at National/Provincial /District levels.


http://www.pbs.gov.pk/content/pakistan-social-and-living-standards-measurement
Riaz Haq said…
One in three households in India owns a two-wheeler
A majority of car owners prefer to use a two-wheeler to reach work, according to the ICE 360° survey 2016

http://www.livemint.com/Politics/Yd2EAFIupVHDX0EbUdecsO/One-in-three-households-in-India-owns-a-twowheeler.html


The proportion of car-owning households in the country was 5%, according to the 2011 census data. That proportion has more than doubled, and stands at 11% today as per the ICE 360° survey 2016. The proportion of two-wheeler owners has increased 15 percentage points to 36%, while the proportion of bicycle owners has increased 13 percentage points since 2011 to 58%, the survey shows.

Households in the top quintile account for a majority of the cars and more than a third of two-wheelers in the country. The top 10% accounts for 46% of the cars and 22% of two-wheelers in India. The bottom quintile, which is the poorest 20%, accounts for a majority of the bicycles in the country, as per the survey. Households having a motorcycle or a scooter or a scooty or a moped have been categorized as owning a two-wheeler in this analysis.


Riaz Haq said…
#Pakistan #steel output up 23% in 2016, fastest growth among 40 countries. #India #Iran #Vietnam #Kazakhstan #China https://www.bloomberg.com/news/articles/2017-05-15/china-building-boom-to-churn-out-pakistan-s-largest-steel-ipo

Agha Steel Industries Ltd. is planning Pakistan’s biggest-ever private sector initial share sale this year to help boost output as China funds more than $55 billion in infrastructure projects across the nation and a buoyant stock market spurs investor demand.

The Karachi-based company plans to raise as much as 10 billion rupees ($95 million) selling a 25 percent stake, Executive Director Hussain Agha said in an interview. The sale will be the largest since the 12-billion rupees government stake sale of Habib Bank Ltd. in 2007, the country’s largest IPO yet.

Steel and cement makers in Pakistan are expanding to meet demand as the “One Belt, One Road” trade route financed by China spurs construction. The nation’s economy has grown at about 5 percent annually since 2013, encouraging Agha’s peers including International Steels Ltd. and Aisha Steel Mills Ltd. to lift production.

“You need roads, sky rises and housing,” said Agha. “Pakistan’s steel industry is in an infancy stage and growing at a massive pace -- the whole environment will change.”

Read more: Chinese Largesse Lures Countries to Its Belt and Road Initiative

The company will use the funds for $50 million expansion that will triple output to 500,000 metric tons within two years. Production will then double to a million tons by 2023, he said. Habib Bank has been appointed financial adviser while Arif Habib Ltd. and BMA Capital Ltd. were picked as book runners for transaction.

Pakistan’s steel output grew 23 percent to 3.6 million tons in 2016, the biggest gain among 40 nations, according to the World Steel Association. Agha Steel expects construction-grade steel, such as rebars and wire rods, to grow as much as 12 percent annually for the next three years.

The construction sector expanded 13 percent in year ended June 2016, more than twice the pace in the previous 12 months, according to State Bank of Pakistan’s annual report. Rapid urbanization and rising income levels has left the nation with an annual shortfall of 500,000 homes, according to real-estate developer Arif Habib.

“Real-estate is the main engine for this growth, it has really picked up,” said Ayub Khuhro, chief investment officer of Karachi-based Faysal Asset Management Ltd., which has about 8 billion rupees in stocks and bonds. “The government is also willing to protect companies with anti-dumping measures.”
Riaz Haq said…
Is #India Lying About Its World Beating #Economy? #Modi #BJP http://www.barrons.com/articles/is-india-lying-about-its-world-beating-economy-1488769695 … via @barronsonline

India just announced its October-December GDP figures, supposedly showing it is still the fastest-growing major economy. You should not believe it. Every quarter there are questions about India’s GDP, with this one no exception. But there is a bigger problem: India refuses to publish the full GDP series, so that the world may not be able to trust the Indian government’s claims at all.

Economic growth should be measured by personal or household income. Instead it is measured by GDP, an accounting tool far more relevant for top-down planners than ordinary people. This is hardly India’s fault, but India has done a small bit to make the problem worse.

In January 2015 India revised recent GDP growth figures higher, among other things raising the fiscal year 2013-4 gain from 5% all the way to 6.9%. It is at this point the fastest-growing economy boasts began. Questions about the revision were raised immediately, including by current Indian government officials, because purportedly faster GDP did not fit with many other indicators. (It still does not.)

Since then, however, the new series has become widely used. While the Indian government argues that it better matches global practices, it manifestly fails to do so in an indispensable respect. The back series – the necessary base for calculations of ongoing GDP growth – has not been published more than 2 years later. Technically, we do not know India’s GDP in 2010, or anytime earlier.

The back series was first to be published December 2015, then mid-2016, and now has no apparent due date and will not be complete. The “globally accepted” new approach therefore makes it impossible to assess India’s GDP trajectory, potentially important information for a country aspiring to rapid development.

The best way to proceed in this case was to start from the beginning, applying the new method to a base year as far in the past as possible and generating new data forward from there. The obvious question is how India determined growth when earlier years could not serve as a base? The answer is unfortunately political: the government’s desire to report faster growth trumped accuracy.

It all may sound familiar. India seemingly always has an eye on China. If China pulled a stunt like this, its “world-beating” claims would be roundly ridiculed. India initially had the benefit of the doubt because it is a multi-party democracy with a competitive press. Those are very good reasons, but not good enough. One benefit of an open society is transparency, and the Indian government is being opaque in self-interested fashion.

India had a poor reputation for statistics quality before the GDP revision. It just revised a GDP growth figure from 7.2% all the way down to 6.5% for Q415.There are other, crucial statistics practices, for example concerning rural electrification, that are clearly biased in the government’s favor. In this context, hiding past GDP looks like a continuation of previous behavior.

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Most people from pluralist open societies want to see pluralist, open India do well. For now, however, India has the same level of economic credibility as a country like Vietnam (which publishes GDP results even before the year ends). World-beating growth? Maybe. Or maybe poorly founded quasi-propaganda.
Riaz Haq said…
Pakistan's finance minister paints a bright economic picture
Ishaq Dar lauds infrastructure and development partnerships as a path to growth

GO YAMADA, Nikkei senior staff writer

http://asia.nikkei.com/magazine/20170518/Politics-Economy/Pakistan-s-finance-minister-paints-a-bright-economic-picture


Pakistan is determined to funnel more money toward infrastructure, small businesses and the poor, and the government has found an array of international partners to make it happen.

Finance Minister Ishaq Dar recently spoke with The Nikkei about Pakistan's development drive and the federal budget for the coming fiscal year through June 2018, which he said will focus on generating 6% gross domestic product growth.

---------

Speaking about the budget to be announced on May 26, Dar said: "After [achieving] macroeconomic stability, we have fully focused on higher GDP growth that brings a better life to people, better per capita income, job opportunities and fills the gap in infrastructure demand."

Next fiscal year, he said, "our efforts will give [growth] another boost. Some fiscal measures and policies will be introduced."

FUNDING DEVELOPMENT Dar pointed to a recent agreement with the World Bank-affiliated International Finance Corporation to set up a Pakistan Infrastructure Bank.

The bank will provide financing for infrastructure projects undertaken by the private sector, he said, describing the new lender as an "equal partnership by the Pakistan government and IFC for 20% each." Other stakeholders from around the world will account for the rest, he said. The bank is expected to have paid-up capital of $1 billion.

And the infrastructure bank is just one piece of the puzzle. "With partnerships with the U.K.'s Department for International Development and the German government-owned development bank KfW, we have created the Pakistan Microfinance Investment Co.," Dar said. Its three-year business plan calls for boosting the number of "beneficiaries of microfinance from the current 4 million to 10 million."

The government, the U.K. aid agency and KfW are teaming up to create the Pakistan Poverty Alleviation Fund. Pakistan will hold 49% of the fund, with the U.K. and German partners holding 37% and 14%, respectively.

Islamabad has also established the Pakistan Development Fund, which will invest in public-sector projects outside the budget. The government's initial investment comes to $1.5 billion.

As for the economy, Dar said the government is "hoping for over 5% growth" for the current fiscal year, noting that the "World Bank is projecting 5.2% in 2017 and 5.5% in 2018."

Looking ahead, he suggested 6% growth is possible for next fiscal year, and that it could reach 7% the following year. "Our GDP is reportedly underestimated by 22-25%. If [the reported growth rate for] fiscal 2017-18 is 6%, it will be actually 7% or more," Dar said.

According to Dar, an old method of calculating national output is responsible for the discrepancy. "It has to be upgraded," he said. "And businesses, especially small and medium-sized businesses, have not been [brought into] the database on which GDP is calculated over 10 years."

To paint a more accurate picture, Dar said he recently "authorized the World Bank to carry out a study, and they will take one year."

UNDAUNTED BY DEFICITS Although Pakistan has had success containing inflation and attracting foreign direct investment, its fiscal and current-account deficits are a risk factor. Dar, however, disputed that, saying: "The fiscal deficit is not an issue. From fiscal 2012-13 to 2015-16, we cut the fiscal deficit from 8.8% to 4.6% of GDP. This fiscal year, we expect it will be close to 4.1%."

Dar chalked up the deficit to two major budget items. One is infrastructure development. "We see a jump from 600 billion rupees ($5.73 billion) in fiscal 2012-13 to 1,600 billion rupees in fiscal 2016-17."
Riaz Haq said…
Indian media on Bunji and Bhasha dams in Gilgit Baltistan:

China To Invest $27 Billion In Construction Of Two Mega Dams In Pakistan-Occupied Gilgit-Baltistan

https://swarajyamag.com/insta/china-pakistan-plan-for-construction-of-two-mega-dams-in-gilgit-baltistan

China and Pakistan have inked a memorandum of understanding (MoU) for the construction of two mega dams in Gilgit-Baltistan, a part of India’s Jammu and Kashmir state that remains under latter’s illegal occupation. The MoU was signed during the visit of Pakistan’s Prime Minister Nawaz Sharif to Beijing for participation in the recently concluded Belt and Road Initiative.

The two dams, called Bunji and Diamer-Bhasha hydroelectricity projects, will have the capacity of generating 7,100MW and 4,500MW of electricity respectively. China will fund the construction of the two dams, investing $27 billion in the process, a report authored by Brahma Chellaney in the Times of India has noted.

According to Chellaney, India does not have a single dam measuring even one-third of Bunji in power generation capacity. The total installed hydropower capacity in India’s part of the state does not equal even Diamer-Bhasha, the smaller of the two dams.

The two dams are part of Pakistan’s North Indus River Cascade, which involves construction of five big water reservoirs with an estimated cost of $50 billion. These dams, together, will have the potential of generating approximately 40,000MW of hydroelectricity. Under the MoU, China’s National Energy Administration would oversee the financing and funding of these projects.
Riaz Haq said…
Economic Survey of Pakistan 2016-17


http://www.finance.gov.pk/survey/chapters_17/overview_2016-17.pdf


Per Capita Income in dollar terms has witnessed
a growth of 6.4 percent in FY 2017 as
compared to 1.1 percent last year. The per
capita income in dollar terms has increased
from $ 1,531 in FY 2016 to $ 1,629 in FY
2017. Main contributing factors for the rise in
per capita income are higher real GDP, growth,
low population growth and stability of Pak
Rupee.

------------------

Real GDP growth was above
four percent in 2013-14 and has smoothly
increased during the last four years to reach
5.28 percent in 2016-17, which is the highest in
10 years.

----

The agriculture sector met
its growth target of 3.5 percent, helped by
government supportive policies and by
increased agriculture credit disbursements.
During 2015-16, the agriculture credit
disbursement was close to Rs 600 billion while
during 2016-17, the target was raised to Rs 700
billion. During July-March 2016-17, the
disbursement was observed to be 23 percent
higher as compared to the previous year. These
developments, along with the Prime Minister’s
Agriculture Kissan Package together with other
relief measures have started yielding positive
results.
The large-scale manufacturing output is
primarily based on Quantum Index
Manufacturing (QIM) data, which show an
increase by 5.06 percent from July 2016 to
March 2017. Major contributors to this growth
are sugar (29.33 percent), cement (7.19
percent), tractors (72.9 percent), trucks (39.31
percent) and buses (19.71 percent). High
growth of sugar is based on production of 73.9Million Tons of Sugarcane as compared to 65.5
million tons last year, which represents an
increase by 12.4 percent.
Large Scale Manufacturing growth has picked
up momentum and posted a strong 10.5 percent
growth in the month of March 2017 compared
to 7.6 percent in March 2016. The YoY growth
augurs well for further improvement in growth
during the period under review.
On average, the LSM growth stood at 5.06
percent during July-March FY 2017 compared
to 4.6 percent in the same period last year. The
sectors recording positive growth during JulMar
FY 2017 are textile 0.78 percent, food and
beverages 9.65 percent, pharmaceuticals 8.74
percent, non-metallic minerals 7.11 percent,
cement 7.19 percent, automobiles 11.31
percent, iron & steel 16.58 percent, fertilizer
1.32 percent, electronics 15.24 percent, paper &
board 5.08 percent, engineering products 2.37
percent, and rubber products 0.04 percent.
Pakistan is bestowed with all kinds of resources
which also include minerals. Pakistan possesses
many industrial rocks, metallic and nonmetallic,
which have not yet been evaluated. In
the wake of the 18th Amendment, provinces
enjoy great freedom to explore and exploit the
natural resources located in their authority, with
the result that they are currently undertaking a
number of projects using their own resources,
or in collaboration with the federal government
or with donors to tap and develop these
resources.
The services sector recorded a growth of 5.98
percent and surpassed its target which was set
at 5.70 percent. Wholesale and retail trade
sector grew at a rate of 6.82 percent. The
growth in this sector is bolstered by the output
in the agriculture and manufacturing sectors.
The share of Agriculture, Manufacturing and
Imports in Wholesale and Retail Trade growth
is 18 percent, 54 percent and 15 percent
respectively. The Transport, Storage and
Communication sector grew at a rate of 3.94
percent. Finance and insurance activities show
an overall increase of 10.77 percent, mainly
because of rapid expansion of deposit formation
(15 percent) and demand for loans (11 percent).
Riaz Haq said…
India's national accounts on economic growth wrong: Expert
BY PTI | UPDATED: JUN 03, 2017, 01.51 PM IST


Read more at:
http://economictimes.indiatimes.com/articleshow/58973943.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

"They (India's national accounts) show India's growing at seven per cent a year. But I along with many other economists, I'm afraid don't believe the national accounts. They were redone in 2011," Vijay R Joshi, Emeritus Fellow of Merton College, Oxford and Reader Emeritus in Economics, University of Oxford, told a Washington audience.

Joshi, the author of a book titled 'India's Long Road--The Search for Prosperity' alleged that India's growth rate is back at 5.5 per cent, but the na ..
Riaz Haq said…
#Pakistan car sales in July 2017 jump 41% to 19,577 units in July 2017, from July 2016 #Tractor sales spike 125% YoY

https://tribune.com.pk/story/1478567/locally-assembled-car-sales-accelerate-july/

Sales of locally assembled vehicles, including jeeps and light commercial vehicles, jumped to 19,577 units in July 2017, up 41% compared to 13,932 units in the same month of 2016, according to latest data released by the Pakistan Automotive Manufacturers Association (PAMA).

A Topline Securities’ report said the numbers were in line with its estimates. The apparently large difference in monthly sales may be attributed to reduced working days in July 2016 because of Eid holidays, the report said.

Pakistan could soon see these electric cars on its roads
Sales of Pak Suzuki Motor Company increased 37% year-on-year (YoY) in July 2017 due to strong demand for Wagon-R, up 77%.

With the introduction of a new model, sales of Cultus rose 66% YoY while Ravi sales were up 41%, which also supported the company’s growth.

Honda outperformed its peers in vehicle sales, posting 113% growth due to successful introduction of a new Civic model and new sports utility vehicle (SUV) BR-V.

Indus Motor sold 4,618 units in July 2017, up 11% YoY. The company’s focus remained on production of higher-margin Fortuner, which recorded a stellar growth of 543%.

Moreover, buyers were postponing their purchase of Toyota Corolla, waiting for the face-lift model, which has arrived now.

Truck and bus sales of PAMA member companies in July 2017 remained strong, growing 13% YoY. The trend is expected to continue, fuelled by the China-Pakistan Economic Corridor (CPEC) led growth, higher road connectivity, lower financing rates and enforcement of the axle load limit per truck on highways by the National Highway Authority.

Two and three-wheel vehicle sales for July 2017 grew strongly by 42% YoY due to rising disposable income of the lower middle class, the report added.

Why Pakistan should switch to hybrid cars

Tractor sales continued to exhibit an upward trajectory with sales growing by 125% YoY in July 2017.

Lower general sales tax, improved crop yield due to Punjab government’s Kisan Package and continuation of fertiliser subsidy to improve farmers’ purchasing power contributed to the strong tractor sales.

Moreover, in the provincial budget for fiscal year 2018, the Sindh government has set aside Rs2 billion in subsidy on tractor purchases by farmers.
Riaz Haq said…
The retail sector seems to be priming the economic pump. As per latest data released by the Pakistan Bureau of Statistics, the overall output of the large-scale manufacturing (LSM) index grew by 5.69 percent in Jul-May FY17. (For more on LSM going forward, please read “L-S-M!” published August 2).


http://www.brecorder.com/2017/08/03/362880/electronics-powered-on/

Among the top-three growth industries in the FY17 LSM index is ‘electronics’ – the other two being ‘iron and steel products’ and ‘automobiles’. Having a roughly 2 percent weight in the LSM index, the electronics industry grew by a recent high of 16.18 percent year-on-year in 11MFY17.

The key electronics items illustrated in the graph have all grown between FY11 and FY16. However, the growth in refrigerators and air-conditioners has been the most prominent. In the more recent period, there is double-digit growth all around, except for the TV sets. During 11MFY17, production of deep freezers grew by 28 percent, refrigerators 24 percent; electric fans 21 percent, and air-conditioners 10 percent, on a year-on-year basis.

In tandem with growth in domestic retail, the production of major electronics items is expected to continue its recent growth run. The middle-class, both its existing members and aspirants, tend to drive the purchases of white goods and electronics. If the economic growth gathers pace, the resulting higher per capita income will push the sales of both lifestyle and convenience products. Already, there is an apparent proliferation of housing schemes in both major and small cities – a sign of upward mobility – that is also a driving factor in appliance sales.

While folks want comfortable lifestyles, not many households currently have that. As per Euro monitor, in 2016, mere 55 percent of households had a washing machine, 43 percent had a refrigerator, 20 percent had a microwave oven, and 16 percent had a deep freezer. There is obviously potential there, more so in rural areas where ownership of household durables is markedly lower than urban areas. Continued flows of remittances and growth in farming incomes are going to be driving forces for electronics sales. But who will feed all that demand? While almost all of the demand for electric fans and refrigerators is being met through local production, the same is not the case for air conditioners, LED TV sets, deep freezers, and washing machines. The domestic players are conscious of the need to invest in product design, functionality, and quality of service. But the price-conscious mass market doesn’t encourage them to really go the extra mile, thus hampering their ability to compete with the imported products.

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