• Tue. Jun 11th, 2024

Economic survey reveals Pakistan’s economy projected to grow by 2.4% in fiscal year 2024

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Jun 11, 2024

Pakistan’s economy is projected to have grown by 2.4 percent in the current fiscal year, which is a significant improvement from the 0.17 percent contraction seen in the previous year. The government’s economic survey revealed this information just a day before the federal budget announcement. This growth estimate aligns with the State Bank of Pakistan’s projection for the full year. The SBP recently lowered its key interest rate by 150 basis points, marking its first rate cut in almost four years as part of its efforts to stimulate economic growth.

The country’s current account deficit has also seen a notable improvement, narrowing by 95 percent to $200 million in the July to April period of the current fiscal year from $3.9 billion in the same period a year earlier. The Finance Minister mentioned that the current account recorded surpluses for three consecutive months until April, with the possibility of another surplus in May. The government is aiming for an economic expansion of 3.6 percent in the upcoming fiscal year, as economic activity picks up.

Pakistan is engaged in discussions with the IMF for a potential loan ranging from $6 billion to $8 billion to prevent a default in an economy that is growing at a sluggish pace compared to its regional peers. Prime Minister Shehbaz Sharif has emphasized the need for tough reforms to secure the IMF loan, though challenges such as high prices, unemployment, and a lack of new job opportunities have put pressure on the coalition government. Sharif’s administration has pledged commitment to implementing necessary reforms to address these issues.

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