Pakistan’s economy is expected to have expanded by 2.4% in the fiscal year ending this month, after contracting by 0.17% in the previous year, the report said. government economic survey Tuesday, a day before the country’s federal budget is unveiled.
The growth estimate is in line with the State Bank of Pakistan’s forecast for the full year. The SBP cut its key interest rate by 150 basis points on Monday, its first rate cut in almost four years, as it strives to revive the economy.
Pakistan’s current account deficit narrowed sharply by 95% to $200 million between July and April FY24, compared to $3.9 billion in the same period of the previous year , according to the investigation.
The current account recorded three consecutive months of surpluses through April, and May could be another month of surplus, Finance Minister Muhammad Aurangzeb said.
In its monthly economic review at the end of May, the government said it was targeting an economic expansion of 3.6% for the new fiscal year starting in July, amid a recovery in economic activity.
Pakistan is in talks with the IMF to secure a loan estimated at between $6 billion and $8 billion to avoid a default for the region’s slowest-growing economy.
Prime Minister Shehbaz Sharif has publicly expressed his commitment to tough reforms since coming to power in February elections. These reforms would be key to securing the IMF loan, but rising prices, unemployment and a lack of new job opportunities have put political pressure on his coalition government. (Reporting by Ariba Shahid, Gibran Naiyyar Peshimam and Asif Shahzad; Editing by Swati Bhat; Editing by Sudipto Ganguly and Gareth Jones)
