On November 5, 2024, Prime Minister Shehbaz Sharif welcomed the State Bank of Pakistan's decision to reduce the policy rate from 22% to 15%. He stated that this significant cut would relieve the debt burden by approximately Rs1.3 trillion, providing much-needed support to sectors such as business, agriculture, and exports [37288e69]. This move aligns with previous reports indicating a positive trend in Pakistan's economic indicators, with inflation decreasing and foreign investments on the rise [9d9bd14e].
Earlier, on November 3, 2024, Mian Nawaz Sharif, president of the Pakistan Muslim League-Nawaz (PML-N), had expressed optimism about the country's economic recovery, attributing improvements to the efforts of Prime Minister Shehbaz Sharif. He envisioned transforming Pakistan into an 'Asian Tiger' and highlighted the government's commitment to addressing high power bills and inflation [7506e1ac].
Finance Minister Muhammad Aurangzeb had previously reported that major rating agencies recognized the improvements in Pakistan's economy, which has led to increased interest from the US business community for investments in the country [9d9bd14e]. During the 2024 IMF-World Bank meetings, Jameel Ahmad, the Governor of the State Bank of Pakistan (SBP), noted that inflation had significantly decreased from a peak of 38% in May 2023 to 6.9% in September 2024, thanks to effective monetary policy adjustments [ee7b6395].
Aurangzeb emphasized the need for further legislative measures to enhance tax compliance and broaden the tax base, particularly through restrictions on vehicle and property purchases by non-filers [9d9bd14e]. The SBP's report also highlighted improvements in the external account, with foreign exchange reserves rising from $3.1 billion in January 2023 to $11 billion by October 11, 2024, with a target of reaching $13 billion by June 2025 [ee7b6395].
In addition to domestic economic strategies, Prime Minister Shehbaz Sharif announced that a Pakistani delegation is set to visit Saudi Arabia to discuss cooperation, hinting at a winter power relief package. He also noted Azerbaijan's approval for $2 billion in memorandums of understanding (MoUs) [37288e69].
Despite these advancements, Nawaz Sharif pointed out the near-default status of Pakistan International Airlines (PIA) and hinted at plans to acquire it, emphasizing the need for strategic interventions in key sectors [7506e1ac]. Earlier, on October 17, 2024, the SBP released a report detailing structural impediments to the country's macroeconomic stability, including declining investment and an unfavorable business environment [c8bbca04].
The government's comprehensive economic plan, including the 'Home-Grown Economic Program', aims to enhance key sectors like agriculture and information technology [d55085f1]. The SBP has also reduced its key policy rate recently to stimulate economic growth, reflecting a response to the slowdown in inflation and strengthening the external economy [c6bb1c96].
As Pakistan navigates its economic challenges, the focus on climate resilience and taxation reforms is expected to significantly improve the lives of citizens, particularly women entrepreneurs, as noted by Dr. Anita Zaidi from the Bill and Melinda Gates Foundation [d55085f1]. With the government's commitment to macroeconomic stability and innovative solutions, Pakistan is poised to make strides in its economic recovery amidst ongoing challenges.