Leading Issues in the Economy of Pakistan: Agenda for Reforms ii) Shortfalls in cotton and wheat of 7 million bales and 3 million tons respectively will require additional imports of up to$4.5 billion. However, the decline in the GDP growth rate to negative 1 percent will reduce the overall demand for imports, along with the impact of a likely faster rate of depreciation of the rupee. Further, there has been a big downgrading of the credit-rating of Pakistan by the various credit-rating agencies. Pakistan was able to get back to the IMF program, but the process of the ninth review has been delayed. This has led already to a big fall in the inflows of foreign investment and loans. The modified projections incorporating the impact of the floods on the balance of payments and other negative developments are presented in Table 4.7. A comparison is made with the original IMF projections for 2022-23. Table 4.7: Balance of Payments after Floods in 2022-23 2021-22 (Actual) IMF Projection (pre-floods) A. CURRENT ACCOUNT DEFICIT-17.4-9.4 Balance of Trade in Goods and Services -44.7-36.4 Exports 39.4 42.9 Imports 84.1 79.3 Net Primary Income-4.4-4.8 Net Secondary Income 31.7 31.8 B. CAPITAL ACCOUNT 0.2 0.2 C. FINANCIAL ACCOUNT 9.9 16.2 Foreign Investment 3.0 5.2 Government Assistance 2.4 7.1 Disbursements 10.7 19.5 Amortization 8.3 12.4 Others 4.5 3.9 D. BALANCE OF PAYMENTS-7.5 7.0 Level of Foreign Exchange Reserves 9.8 16.8 Source: SBP After Floods -8.3 -33.7 39.9 73.6 -4.3 29.7 0.2 5.1 1.0 0.6 13.0 12.4 3.5 -3.0 6.8 ($ Billion) Difference +1.1 +2.7 -3.0 5.7 +0.5 -2.1 ­-11.1 -4.2 -6.5 -6.5 0.0 -0.4 -10.0 There are a number of significant differences from the IMF projections as follows: i) Despite the higher imports of wheat and cotton the import level is likely to be lower by $5.7 billion because of greater depreciation of the rupee, lower GDP growth rate and 54