Caretaker Finance Minister Shamshad Akhtar addressed the nation in a press conference yesterday, underscoring the encouraging signs of economic recovery in Pakistan attributed to measures taken by the interim government.
Akhtar’s remarks followed the recent decision by the State Bank of Pakistan (SBP) to maintain the policy rate at a steady 22% for the upcoming months. The Monetary Policy Committee (MPC) made this decision in light of the latest inflation figures, which have been steadily declining from a peak of 38% in May to 27.4% in August 2023.
Standing alongside caretaker Minister for Information and Broadcasting Murtaza Solangi and Minister for Energy, Power, and Petroleum Muhammad Ali, Akhtar commented, “The macroeconomic indicators, if you view them, you can find some betterment. There are some signs of economic recovery. Even if it is just starting.”
She went on to highlight the positive developments in various sectors of the economy. Notably, the Consumer Price Index (CPI) has seen a significant decline from over 38% in May to 27.2% at present, signaling improved conditions for consumers.
Akhtar acknowledged the challenges faced by the caretaker government but emphasized their commitment to addressing these issues methodically. The government’s strategy has focused on prudent financial management, cost control, and revenue enhancement to enhance the economic situation.
Furthermore, Akhtar stated that Pakistan has emerged from some of its difficulties, with the potential for further improvements in the future. She cited the agricultural sector’s promising performance, which is expected to yield positive outcomes for both minor and major crops, contributing to overall economic growth.
The finance minister also noted the resurgence in the industrial sector, particularly in areas like the cement industry. As economic activities gradually pick up, the industrial sector is poised for further growth.
Highlighting the importance of the services sector, Akhtar stressed its vital role in the overall economy, acting as a driving force for other sectors.
In addition, Akhtar commended the SBP’s decision to keep interest rates unchanged, which is expected to reduce borrowing costs for industries and stimulate their revival. She revealed that the government had engaged in discussions with donors, expressing optimism about the possibility of expedited funding in key areas.
Akhtar disclosed that the government is anticipating approximately $2 billion in fast-tracked assistance, with the Asian Development Bank (ADB) expected to accelerate funding for the Revitalising Informal Settlements and their Environments (RISE) program.
Furthermore, the finance minister emphasized the government’s dedication to implementing reforms beneficial to the population and designed to instill investor confidence, thereby attracting Foreign Direct Investment (FDI).
To enhance remittances, Akhtar announced an allocation of Rs80 billion for initiatives aimed at improving remittance flows through formal channels, with Rs20 billion already disbursed to banks for this purpose. She also noted the stability in foreign exchange reserves, attributing it to Exchange Companies Reform and anti-smuggling efforts that have helped stabilize the Pakistani rupee.
In conclusion, Akhtar reassured the public that the government was actively working on various initiatives to usher in positive change and facilitate a robust economic recovery.
