PAKISTAN’S ECONOMY: A FLOURISHING FUTURE ON THE HORIZON

Hira Tahir
21 November 2023
In recent times, Pakistan has witnessed a remarkable transformation on the economic front, owing
to the collaborative efforts of the government and the military. This positive momentum has led to
significant developments, ranging from an increase in foreign exchange reserves to successful
negotiations with international financial institutions. This article delves into the promising
economic landscape of Pakistan, highlighting key indicators that underscore the nation’s
newfound stability and growth.
Surging Foreign Exchange Reserves
One of the most tangible indicators of Pakistan’s economic upswing is the surge in foreign
exchange reserves. In the past few months, these reserves have witnessed a commendable
increase, growing by $67 million weekly and reaching an impressive $7.7 billion. This surge not
only reflects increased economic stability but also enhances the country’s capacity to weather
unforeseen economic challenges.
Roshan Digital Account’s Impact
The Roshan Digital Account (RDA) has played a pivotal role in facilitating outward remittances,
crossing a noteworthy milestone of $6.75 billion in October 2023. This surge demonstrates the
trust and confidence of the Pakistani diaspora in the country’s economic policies, contributing
significantly to the foreign exchange reserves.
Boost in Foreign Investment
Foreign investment has been a key driver of Pakistan’s economic growth, with the first three
months of FY 2023-24 witnessing an influx of $72.7 million. Notably, the recent infusion of Chinese
investment has propelled total foreign investment to an impressive $126.3 million, signaling
increased international confidence in Pakistan’s economic potential.
Resilient Banking Sector
Despite facing malicious social media campaigns targeting bank deposits, the banking sector has
shown remarkable resilience. Deposits held by banks have witnessed a substantial 15.33% yearon-year increase, reaching Rs 26.32 trillion in October 2023. This surge underscores the public’s
trust in the stability of the financial system.
IMF Agreement and Economic Stability
The recent finalization of an agreement with the International Monetary Fund (IMF) is a significant
milestone for Pakistan. This agreement is set to inject an additional $70 million into the economy,
further solidifying the country’s economic stability. The inflow of such a substantial amount is
expected to have a ripple effect, positively impacting various sectors.
Asian Development Bank’s Support for Power Sector
The Asian Development Bank’s approval of a $250 million loan for the strengthening of Pakistan’s
power system is a testament to the country’s commitment to infrastructure development. With a
low markup, this loan is poised to significantly enhance the power sector, addressing longstanding issues and fostering sustainable growth.
Historic Stock Exchange Performance
Pakistan’s stock exchange has been breaking records, surpassing the 57,000-point mark in a
historic achievement. This remarkable performance is indicative of investor confidence and
reflects the positive sentiment prevailing in the market.
Government’s Crackdown on Illegal Economic Activities
In tandem with economic improvements, the government has intensified its crackdown on illegal
economic activities. Measures against electricity theft have resulted in the recovery of about 46
billion rupees. Additionally, stringent actions against the gold and dollar smuggling mafia aim to
tighten the grip on those engaged in illicit financial activities, further stabilizing the economy.
Dollar, Gold, and Petrol Price Decline
The positive economic indicators have had a cascading effect on key commodities. The prices of
the dollar, gold, and petrol are on a continuous decline, providing relief to consumers. This
downward trend is expected to persist, fostering a more affordable and stable economic
environment.
Pakistan’s recent economic achievements paint a promising picture for the nation’s future. From
bolstered foreign exchange reserves to historic stock market highs, the collaborative efforts of the
government and the military are yielding tangible results. As the country continues on this path of
economic growth and stability, it is poised to attract further foreign investment and solidify its
position on the global economic stage. The ongoing crackdown on illegal activities and the
commitment to infrastructure development set the stage for a flourishing future for Pakistan.