IMF acknowledges stability in Pakistan’s economic activity

Islamabad: The IMF on Saturday acknowledged that Pakistan's economic activity has stabilized and inflation has begun to gradually decline on the back of strong policy adjustment.

In its country report on Pakistan, the international lender said that external pressures have eased somewhat since June last year and the State Bank of Pakistan has taken advantage of renewed inflows to begin rebuilding foreign exchange reserves.

The IMF report further said that Pakistan's fiscal performance has also improved with the government achieving a primary surplus in the first quarter of this fiscal year.

Welcoming this progress, the IMF warned that the outlook is still challenging.

Meanwhile, Caretaker Finance Minister Shamshad Akhtar said despite challenges, Pakistan has made significant progress towards macro-economic, exchange rate and financial stability.

Virtually addressing an IPO summit, she said growth is to rebound in the positive trajectory in the range of two to two and a half percent with agriculture expected to grow by five point six percent and industry by two and a half percent during the current fiscal year.

The Finance Minister said the capital markets cannot thrive under very high interest rate regime.

She said the State Bank of Pakistan is conscious of the fact that we will have to move to lower the interest rate subject to inflation coming down.

She said foundation has been laid for attracting foreign direct investment. 

Shamshad Akhtar said economic recovery process has bolstered business confidence and market sentiments. Pakistan Stock Market Index exhibited bullish momentum over the last five months.