A deadly virus was introduced to the world at the end of 2019. Its first case was identified in Wuhan city of China and afterward, it starts spreading widely all around the world. On March 12, 2020, declared a pandemic by Worlds Health Organization (WHO).
To control the worldwide spread of the virus about one-third of the world’s population was placed into lockdown, affecting the global economy. Business closure occurs which increases the rate of unemployment and poverty. So, Covid-19 is not only a threat to life but also becomes a threat to the global economy and financial markets.
Covid-19 impact on the economy of Pakistan
In Pakistan, covid-19 has the same impact. Pakistan’s economy also had a huge effect. As first recognized in Pakistan the government has announced lockdown. Closing of manufacturing business reduces the production, disturbing the supply and demand side in Pakistan. Small businesses become the victim of this pandemic. According to a report, most of them are not ready for this pandemic and the rest are afraid that if the lockdown continues their businesses will collapse.
The commercial business shifted to work from home where only essential staff is required, this also becomes one of the reasons for unemployment.
This deadly pandemic also negatively influenced the food and agricultural sectors. A report says that there was a shortage of food at homes of households and the unavailability of foodstuffs at markets. Farmers are facing difficulties in selling these goods to the markets due to limited transportation in the country. Food supply and demand chain get badly affected.
Service industries such as hospitality, tourism, and transportation suffered losses. Trading also pauses during this lockdown period.
The GDP growth rate for the fiscal year (FY) 2020has been revised to 3.0 % down from 3.3 % to fiscal year (FY) 2019 as according to the State Bank of Pakistan.
Improvement in Pakistan’s economy
As compared to other developed countries Pakistan gets better control on the economy of widespread of a virus. Although at the beginning of the pandemic Pakistan faces economic crises but gradually starts improving by making containment strategies. As instead of placing the whole country in lockdown Pakistan’s government has announced smart lockdown in areas having a high percentage of positive cases. Agriculture sectors and other business resume their work. The government of Pakistan and the State Bank of Pakistan also announces relief programs in the country.
Now economic growth is rebounded to3.9% in FY2021 and is expected to reach 4.0% in FY2022.according to Asian Development Bank (ADB) Pakistan’s economy improves the year 2022.