KARACHI:
Pakistan’s economy is experiencing a positive upturn marked by rising foreign investment and a recently achieved surplus in the current account. Despite enduring years of economic challenges, the efforts of both military and political leaders have successfully instilled confidence in global investors. The newly formed Special Investment Facilitation Council is demonstrating tangible impacts on foreign investment.
In the initial five months of the current fiscal year, external funding amounted to Rs 4.28 billion signifying a 21% surge in foreign investment. The State Bank reported a notable private sector investment of $69.45 million from July to November comprising $65.61 million in direct investments and $3.84 million in portfolio investments. November witnessed a current account surplus of $900,000 leading to a 64% reduction in the annual current account deficit and a 28% decrease in the trade deficit. Domestic exports grew by 5% reaching $12.511 billion, while imports decreased by 16%, totalling $21.281 billion.
Experts attribute the current account surplus to improved technology exports, government services, reduced interest payments and foreign companies withholding profits. The challenge ahead for the government lies in keeping imports low to prevent a deficit. Sustaining export growth and managing import reductions are crucial for economic stability.
Amin Baloch
Tank
Published in The Express Tribune, December 21st, 2023.
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