Though the economy of Pakistan has always remained under pressure since independence, it has now begun to show some signs of recovery underpinned by falling global oil prices and the expected uptick in the regional stock markets. Indeed, to quote from a report by the Asian Development Bank (ADB), Pakistan’s economic growth in 2015 would modestly improve to 4.2 percent and to 4.5 percent in 2016.But that is the subject to steady progress in macroeconomic and structural reforms, and stable security, political, followed by weather conditions.
Last year, the country showed renewed confidence with higher foreign exchange reserves, lower fiscal deficit and moderate inflation. However, the gross domestic product (GDP) growth is still below the rate required to absorb a growing labour force.Well, in the light of the ADB’s annual report, Pakistan’s economy is likely to continue forward push with a modest growth trajectory.In the present situation, the government will have to make new efforts to attract direct foreign investment, create jobs, reduce poverty and boost economic growth.As a matter of fact, sincere efforts are required to making the power sector financially viable.Reforms and structural changes are also necessary in the public sector enterprises while the government is already opting for the privatisation of the entities, which have become burden rather than assets. A bridge is required to be built between businessmen andpolitical elite to revamp the national economy.
It is generally expected that security challenges will continue to weigh on the country’s business climate.Report says that one should not forget that a key risk to the fiscal performance still exists due to falling exports, circular debt and low revenue collections.The report adds that one can predict safely, attracting higher private investment also requires policy measures to boost the export competitiveness of Pakistani manufacturers, accelerate financial sector development, increase public sector investment in infrastructure, and competitive exchange rates in the foreseeable future.The reports adds that Pakistan’s economic transformation has largely bypassed deepening and diversification of manufacturing because it has evolved from agriculture to a largely low productivity services. And, to be sure, enhancing industrial competitiveness will require Pakistan to address policy distortions, lower trade barriers, create a business-friendly environment with a stable microeconomic framework, and improve infrastructure, access to finance, and human development.Together with higher earnings, lower inflation and people’s spending power will contribute tremendously to economic growth of Pakistan.
