RAWALPINDI: The State Bank Governor, Mr Ghulam Ishaq Khan, today [Sept 8] said that the country’s economy during 1972-73 staged a marked recovery in global terms, but the recovery was accompanied by certain disconcerting trends. In his annual address to the Bank’s 25th annual general meeting, Mr Ghulam Ishaq Khan said during the year per capita income rose by 3.8 per cent and Gross National Product by 6.5 per cent. But the rise in GNP was not accompanied by a proportionate rise in the availability of goods. …

He said for the first time after 1950-51 the trade balance was in surplus. But, he added, a major factor in increasing our export earnings, besides the advantage derived from the exchange rate adjustment … was the dramatic upsurge in world commodity prices. …

Referring to the rise in prices and the lower level of production in the case of a number of agricultural and industrial products, he recommended that thought be given to the evolution of a price-and-wage policy — linking wage increases with an index of productivity in the concerned industry … as “wage increases in excess of the increase in productivity are self-defeating” because “they are bound to result in price rise”.

Published in Dawn, September 9th, 2023