Despite regional instability and global economic uncertainty, Governor of the State Bank of Pakistan, Jameel Ahmad, expressed confidence that the country will achieve economic growth between 3.75 and 4.75 percent while keeping inflation within the 5-7 percent range during the current fiscal year. The remarks were made during a briefing to the Senate Standing Committee on Finance, chaired by Senator Saleem Mandviwalla.
The SBP governor outlined the current state of Pakistan’s external accounts, noting that total external debt and liabilities have reached USD138 billion, of which USD103 billion constitutes public external debt. He acknowledged a decline in exports by 7 percent but emphasized that the central bank’s intervention in the foreign exchange market has stabilized the currency and strengthened external buffers without increasing external borrowing. Over the last three years, the SBP bought USD24 billion from the market, supporting reserve levels and exchange rate stability.
Governor Ahmad highlighted that Pakistan’s external debt has grown from USD55 billion in 2015 to USD103 billion in 2022, yet there has been no increase in external borrowing over the past four years. The total external liabilities stand at USD138 billion, marking a rise of approximately USD7 billion in the current period. He further reported that Pakistan’s foreign exchange reserves have reached USD16.2 billion, with projections indicating growth to USD18 billion by June and USD20 billion by December 2026. He cautioned, however, that international oil prices could escalate to around USD100 per barrel if regional conflicts persist, potentially impacting the economy.
Despite these risks, the SBP governor maintained that the current account deficit would remain manageable at 0-1 percent of GDP even in the event of elevated petroleum prices. Workers’ remittances are expected to provide substantial support, projected at USD42 billion for the fiscal year, helping to sustain the external account.
During the session, the committee reviewed qualitative measures taken by the SBP to stabilize reserves and manage public debt. Senator Mandviwalla emphasized the need to explore untapped export markets to counter declining trade performance and ensure sustainable growth.
The meeting also addressed the Women Inclusive Finance initiative, aimed at improving access to credit for female entrepreneurs. Officials confirmed that allocated funds have been fully disbursed, yet the committee requested detailed bank-wise and province-wise reporting to address challenges women face in accessing financial services.
The briefing concluded with directives for follow-up actions on export promotion, debt management, and monitoring the Women Inclusive Finance initiative, reinforcing the government’s commitment to fostering inclusive economic growth while navigating external and domestic challenges. The session highlighted the SBP’s proactive role in stabilizing Pakistan’s financial system, managing external liabilities, and supporting sustainable development through targeted financial policies and initiatives.
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