ISLAMABAD: Pakistan's government outlined a long-term economic strategy focused on macroeconomic stability, structural reforms and private-sector-led growth, presenting it as the next phase of efforts to strengthen the country's economy.
Adviser to the Finance Minister Khurram Schehzad presented the strategy during the seminar "Pakistan Economic Outlook: FY2027 and Beyond" in Lahore, where he reviewed economic performance over the past two to three years and detailed the government's reform agenda.
Khurram stated that Pakistan has moved from a period of economic stress to greater macroeconomic stability. Real GDP growth recovered to 3.7%, supported by gains in agriculture, manufacturing and services.
Agricultural growth reached 2.89%. Large-scale manufacturing expanded 6.1%, its strongest performance in four years, while the services sector grew 4.4%.
Fiscal management also improved, with the fiscal deficit falling to below 1% of GDP during the first nine months of the fiscal year. The debt-to-GDP ratio declined from 75% to 68%.
The current account deficit narrowed to less than $150 million, compared with $17.5 billion in 2022. Inflation eased to 7.5%, while the State Bank of Pakistan's foreign exchange reserves increased to $18 billion, providing more than three months of import cover.
The adviser noted that higher inflows through Roshan Digital Accounts, rising information technology exports and increased freelance earnings contributed to the stronger external position. He also noted that international credit rating agency S&P upgraded Pakistan's sovereign rating to 'B' with a stable outlook.
The government is pursuing reforms in state-owned enterprises, tax administration, the energy sector, pensions and tariff rationalization. The adviser stated that privatization was underway for Pakistan International Airlines, First Women Bank, House Building Finance Corporation and power distribution companies.
To encourage private investment, the government has introduced tax relief measures, expanded private-sector credit and approved concessional export financing for small and medium-sized exporters.
Khurram Schehzad said the government is finalizing a Comprehensive Industrial Policy and a Medium-Term Tax Policy aimed at providing long-term policy certainty and strengthening Pakistan's industrial competitiveness.
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