ISLAMABAD, Jan 14 (KUNA) -- Positive indicators in Pakistan's economy, after years of political and economic insecurity, are taking the country towards a hope for return of economic stability following the general elections in February 2024.
After the general elections on February 8th, the hardest challenge for the new government was the revival of the economy as the country was facing visible external economic pressure.
The positive growth rate, increase in foreign reserves, substantial decline in inflation and a stable exchange rate showcase vibrant visualization of the new government to build gains in the last 11 months.
Joint Economic Adviser to the Prime Minister on Growth and Stabilization Dr. Imtiaz Ahmad, providing financial statistics to KUNA, said that economic indicators are positive in all sectors including the external, real estate, production, fiscal and stock market alongside a decline in inflation.
He said that Roshan Digital Account inflow from overseas Pakistanis increased to USD 9.1 billion till November 2024 from USD seven billion in November 2023.
He said this shows a trust in the policies of the government by the Pakistanis overseas and "we hope that it will grow further." According to the Finance Ministry of Pakistan, the current account balance during July-November posted a surplus of USD 0.94 billion against the deficit of USD 1.67 billion in the same period 2023 where exports increased by three percent.
The foreign direct investment (FDI) increased by 31.3 percent, workers' remittances increased by 34.6 percent and the GDP growth is estimated at 2.52 percent for fiscal year (FY 2024 compared to -0.22 percent in FY 2023.
Foreign exchange reserves of the country stood at USD 16.3 billion on December 21st 2024 compared to USD 8.21 billion in February same year.
Around 12 sectors witnessed positive growth including food, tobacco, wearing apparel, textile, petroleum products and automobiles.
For July-November 2024 period, car production increased by 60.8 percent, production of fertilizer increased by 11.1 percent, incorporation of registered companies increased by 13.1 percent and tax collection increased by 23.3 percent.
The fiscal balance posted a surplus at 0.4 percent of GDP from July-October 2024 compared to the deficit of 0.8 percent of GDP the year before.
Inflation declined considerably to 7.9 percent in July-November compared to 28.6 percent in the same period 2023 due to government's relief and administrative measures to control the price hikes.
After a challenging year in 2023, Pakistan's international partners are committed to supporting Islamabad's new effort as the country formed a special body, the Special Investment Facilitation Council (SIFC), under the Prime Minister aimed at facilitating international investors and fast-track project development.
Last October, Pakistan and Saudi businessmen signed 27 MoUs worth USD two billion in diverse sectors and the Pakistan government keenly seeks to finalize the implementation phase of the agreements.
Moreover, Pakistan signed 13 MoUs worth USD 250 million last November with China to export fruits and vegetables, seafood and animal feed and establish joint ventures in Pakistan offering valued incentives for foreign investors.
During a high-level review meeting on the progress of the Board of Investment last week, Prime Minister Shehbaz Sharif directed authorities to expedite the completion of Business Facilitation Centers across Pakistan.
"A comprehensive and effective roadmap should be developed to finalize Business to Business agreements with international investors and implement signed MoUs," said the Prime Minister.
A team from the International Monetary Fund (IMF) visited Pakistan last November and the authorities reaffirmed commitment to the economic reforms supported by the 2024 Extended Fund Facility.
The Asian Development Bank has also approved a USD 200 million loan to support Pakistan in modernizing its power distribution infrastructure and improving the reliability of its electricity supply.
The Pakistan government is making its best efforts to stabilize and grow its economy through international investments and increase in exports.
Being an agricultural country, the government is also focusing on its agricultural exports where the agriculture sector posts five percent growth this year, and Pakistan has historically achieved a USD four billion revenue milestone from the exports of rice.
According to the State Bank of Pakistan, Information Technology (IT) exports reached USD 3.2 billion in FY 2024, up 24 percent from FY 2023.
The government has set an export target of USD 25 billion for IT exports in the next five years with its focus on GCC countries.
A major boost to the Pakistan Stock Exchange (PSX) is witnessed as the benchmark KSE-100 index crossed 112,535 points compared to around 63,000 points in February 2024 after the general elections, making it among top performing stock markets in 2024.
Economic analysts attribute the upward market trend to the positive indicators of the economy and a major cut of around 900 Basic Points (bps) from its recent peak bringing the interest rate to 13 percent.
Earlier in December, while addressing the Economic Coordination Committee of the Cabinet meeting, Minister for Finance and Revenue Muhammad Aurangzeb disclosed the government plans to enhance economic diversification, invest in key sectors like agriculture, manufacturing, and infrastructure, and pursue reforms to strengthen the financial system.
The financial budget has already removed the special tax regimes for exporters and developers, moving them into the standard corporate tax regime.
The government's policies symbolize a new approach to growth and development by focusing on international investments to stabilize the economy with an effort for structural reforms connected with continuation of appropriate macroeconomic policies. (end) sbk