Pakistan’s economy is projected to have grown by 2.4% in the fiscal year ending this month, rebounding from a 0.17% contraction the previous year, according to the government’s economic survey released on Tuesday. This growth estimate aligns with the State Bank of Pakistan’s projection for the full year, as the SBP cut its key interest rate by 150 basis points in an effort to stimulate the economy.
The country’s current account deficit has significantly reduced by 95% to $200 million in the July to April period of the current fiscal year, down from $3.9 billion in the same period last year. The Finance Minister, Muhammad Aurangzeb, mentioned that the current account has recorded surpluses for three consecutive months until April, with May likely to show another surplus.
Pakistan aims for a 3.6% economic growth rate in the upcoming fiscal year starting in July. Talks with the IMF for a loan of $6 billion to $8 billion are underway to prevent a default in an economy that is experiencing slow growth compared to its regional counterparts. Prime Minister Shehbaz Sharif, who took office after the February election, has pledged to implement tough reforms necessary to secure the IMF loan, despite facing challenges such as high prices, unemployment, and limited job opportunities.
