Pakistan is proving itself in terms of fulfilment of the clauses set by the International Monetary Fund (IMF), as part of their loan programme. Due to the progress in the last couple of months, Pakistan has witnessed the approval of a $300 million loan from the Asian Development Bank (ADB). This is a great development of part of our country, that has been tackling the economic crisis since the Pakistan Tehreek-i-Insaaf (PTI) government assumed power. The IMF has itself noted that Pakistan’s economic reform programme is on track, as the decisive policy implementation by the government is helping to preserve economic stability aiming to put the economy on the path of sustainable growth.
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The major development, in this case, is how the government has managed to bring down the trade deficit by 35 per cent in just a matter of a year, with strict control over imports in order to boost the exports of the country. At the same time, the government’s policy to shift to a market-determined exchange rate has worked in its favour. The Pakistani rupee now stands at PKR154 against the dollar, and those who were inclined towards buying dollars are now interested in getting their funds liquidated to get more Pakistani rupee. This works out in favour of our own economy.
The government is also planning to inject funds into the economy via foreign investment. The ADB is also looking towards another loan for infrastructural development and reforms in the country. Along with this, the government is already working to improve the environment of the workforces in the country, strengthen governance, and foster private sector investment. There is a need to rethink the working strategy of state-owned enterprises too in order for them to not be a burden on the domestic economy.
This is a tough challenge that the government has undertaken, with the economic policy having a grave effect on the buying power of the consumers and the losses being incurred by the domestic businesses. The GDP of the country is barely available for developmental funds. If the government manages to overcome the domestic challenges, Pakistani economy might be destined to see better days, along with a better relationship with the IMF – one of increased belief in the ability of Pakistan to execute plans and overcome challenges faced by the country.