Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, has declared that Pakistan’s economic foundation has been significantly strengthened, with key indicators showcasing substantial improvements. Speaking at the Economic Coordination Committee (ECC) meeting on Wednesday, the minister highlighted advancements in the current account, remittances, exports, foreign exchange reserves, and inflation rates, setting the stage for sustainable economic growth.
Aurangzeb emphasized that the current account has recorded a surplus for the first time in nearly a decade, reflecting the success of targeted fiscal policies. Exports are on an upward trajectory, and inflation has dropped to its lowest level in six years at 4.9% as of November 2024. This decline represents the lowest Consumer Price Index (CPI) since April 2018, when it was recorded at 3.96%. The CPI improvement signals the government’s effective management of inflationary pressures and price stability for essential commodities.
The finance minister revealed that remittances are projected to surpass $35 billion by the end of the current fiscal year, compared to $33.2 billion last year. He also noted a reduction in the policy rate to 13%, which has bolstered the confidence of the business community. This sentiment is reflected in increased sales across several sectors: cement by 5%, fertilizers by 6%, automobiles by 58%, and petroleum by 15%.
Foreign exchange reserves have also seen significant growth, with the country expected to achieve a three-month import cover by the fiscal year’s end. This progress is critical for improving Pakistan’s credit ratings, with the nation moving toward a single “B” rating. The Roshan Digital Account program has recorded an inflow of $9 billion, a 31% increase, further illustrating the positive trajectory of Pakistan’s financial ecosystem.
Aurangzeb highlighted that industrial participants view the current economic developments favorably, particularly as debt servicing costs have halved. The KIBOR rate has dropped below 12%, enabling large companies to borrow at rates lower than the benchmark.
The ECC meeting also reviewed reductions in the prices of essential goods and services, including wheat flour, diesel, petrol, basmati rice, pulses, sugar, and electricity charges. These measures have eased the financial burden on citizens and strengthened their purchasing power, addressing key concerns of affordability and accessibility.
Looking ahead, the government plans to enhance economic diversification by investing in critical sectors such as agriculture, manufacturing, and infrastructure. Public-private partnerships will play a pivotal role in fostering long-term economic growth and job creation.
Aurangzeb reiterated the government’s commitment to maintaining this positive economic trajectory through continued reforms, effective public finance management, and strategic policy implementation. He assured both the public and the business community that efforts to stabilize the currency, improve domestic production, and manage inflation would remain a priority.
While acknowledging the progress made, the ECC emphasized that sustained efforts are essential to maintain economic stability. The committee reaffirmed its dedication to closely monitoring economic developments and implementing measures to safeguard growth.
The finance minister expressed optimism about the future, noting that the advancements achieved so far provide a solid foundation for continued prosperity. The government remains steadfast in its mission to build a stable and thriving Pakistan, ensuring improved living standards and economic opportunities for all.