According to the world media reports, the Pakistani stock market has emerged as one of the world’s top 10 performers with 16 percent advancement in the benchmark Karachi Stock Exchange (KSE-100) index during the last 12 months. In its latest report on Pakistan’s economy, Bloomberg News highlights the economic performance of the Pakistan Muslim League-Nawaz government in terms of trade, investment and industry for the last two years. The government is likely to spend Rs 1.5 trillion on infrastructure projects during this fiscal year while it has fulfilled all the requirements to get $ 6.6 billion loan program of the International Monetary Fund. The government is boosting infrastructure spending as the country’s economy is expanding at a fast rate despite the army operation against terrorists.
The State Bank of Pakistan had cut the benchmark interest rate in May to the lowest level in 42 years while the government has successfully restricted inflation to a certain level, paving the way for consumer spending in the country. The lower oil prices have curtailed transport cost which resulted in decline of food prices. On another note, China is coordinating with Pakistan on economic issues and both the countries have signed deals for $28 billion investment as part of a planned $45 billion economic corridor from Gwadar to Kashghar. The Moody’s Investors Service and other world renowned agencies are also upgrading Pakistan’s sovereign credit ratings and the IMF expects a 4.5 percent growth in this fiscal year. The government has averted a balance-of-payments crisis and resumed the process of privatization of the state-owned enterprises. The cement and steel manufactures listed on the stock exchange are expanding their businesses due to recent boom in the construction industry. The country’s cement industry has rallied 57 percent the past year, more than triple the gains by the benchmark, thanks to the boom in the construction industry.
As a matter of fact, all the indicators about the economy of Pakistan are positive and the government should also have to closely look at the economic policies in the region. Whether Pakistan is a frontier market or emerging market, there is big potential in its resilient economy. What only need to do is to emulate an emerging economy such as Indonesia, Malaysia, Vietnam or Thailand to put the country on the path of development. The government has set very promising targets for tax collection this fiscal year, but it should not forget that harassment of business community will have negative impacts on the economic growth.
