(Maria Mansab)
Pakistan’s economic journey in 2024 has been nothing short of remarkable. Contrary to the bleak predictions often portrayed by anti-Pakistan elements particularly those attempting to sabotage the upcoming SCO agenda, the nation has shown resilience and determination, transforming a challenging environment into one of growth, recovery, and optimism. The story of Pakistan in 2024 isn’t one of collapse or failure but of impressive progress and renewal, driven by strategic reforms, rising investor confidence, and the collective efforts of “Team Pakistan.”
One of the most encouraging signs of Pakistan’s economic turnaround is its GDP growth for April 2024, which surged to 3.07%, surpassing Bloomberg’s earlier forecast of 2.7%. This strong performance highlights the effectiveness of structural reforms and government initiatives. With a 3.6% growth target for FY2025, Pakistan is on a solid path toward sustainable, long-term growth.
Pakistan’s transformation is evident in the Pakistan Stock Exchange (PSX) which Bloomberg recognized as one of the world’s top-performing markets in 2024. The PSX surged by 30%, with its benchmark index hitting a record high of over 83,500 points compared to 51,070.83 points in October 2023. For four consecutive sessions, it gained momentum, attracting $87 million in foreign investment the highest in a decade reflecting renewed global confidence in Pakistan’s economic stability and prospects.
The overall picture for exports has been equally positive. In September 2024, Pakistan’s exports climbed to $2.805 billion, up from $2.471 billion in the same month of the previous year. As a result of this export growth, the country’s foreign exchange reserves have seen a significant rise.
By the end of September 2024, reserves held by the State Bank of Pakistan (SBP) surged to a 30-month high of $10.70 billion, with expectations that they could reach $13 billion by the end of the fiscal year in June 2025. Total foreign exchange reserves have now reached $15.98 billion, compared to $13.13 billion in September 2023, highlighting the government’s adept handling of fiscal matters.
Pakistan’s foreign exchange reserves have been further bolstered by a sharp increase in remittances. In the first two months of the current fiscal year (July-August), remittances reached $3 billion, compared to an average of $2.5 billion per month in the previous year.
This growth reflects the confidence of overseas Pakistanis in the country’s economic future. Another important development is the significant improvement in Pakistan’s current account balance. As of September 2024, the current account surplus had risen by $75 million, compared to just $8 million in September 2023. This marked shift is the result of a combination of higher exports, remittances, and foreign investment, all contributing to a healthier external financial position.
Tax revenue collection has also seen remarkable progress. In September 2024, the Federal Board of Revenue (FBR) surpassed its monthly target by Rs 2 billion, collecting Rs 1.10 trillion. This success not only strengthens the country’s fiscal management but also provides the necessary funds for public services and development projects.
Foreign direct investment (FDI) has been another bright spot in Pakistan’s economic revival. During the July-August period of 2024, FDI reached $350.30 million, a significant increase from $225.2 million in the same period last year. This surge highlights the success of government efforts to create a more attractive environment for foreign investors through streamlined regulations and improved infrastructure.
Additionally, gross foreign exchange inflows through Roshan Digital Accounts (RDAs) reached $165 million in August 2024, compared to $130 million in August 2023, further illustrating the growing confidence of the Pakistani diaspora and foreign investors in the country’s future.
Tourism is becoming a key contributor to Pakistan’s economy, accounting for 5.8% of GDP and employing over 4.7 million people. The government aims to raise tourism’s share to 7% of GDP by 2025, which could create 10 million new jobs and further establish Pakistan as a premier global destination.
One of the most critical issues Pakistan faced in recent years was rising inflation. However, 2024 has brought significant relief in this area as well. The Consumer Price Index (CPI) fell to 6.9% in September 2024, down from 9.6% in August, marking a three-year low.
The State Bank of Pakistan (SBP) played a key role by reducing its key policy rate by 200 basis points to 17.5%, the third consecutive rate cut since June, signaling a commitment to balancing inflation control with economic growth. A major factor contributing to inflation control has been the stability of the Pakistani rupee. Over the past 12 months, the rupee has remained stable, trading at Rs277.51 to the US dollar.
This currency stability has, in turn, helped lower the cost of essential commodities such as food and energy. Between September 2023 and September 2024, the prices of many critical goods declined significantly, bringing relief to consumers and restoring their purchasing power.
Pakistan’s economy is on a steady path to improvement, yet a particular faction is pursuing an anti-state agenda. Seeing their failures in light of the nation’s economic progress, they are attempting to hinder this progress. Their latest efforts appear to be aimed at sabotaging the upcoming SCO Summit, as they feel increasingly irrelevant by standing on the side of non-development. All of us must act with prudence and unite for the sake of the country’s growth, securing a prosperous future for the generations to come.
The columnist is an MPhil scholar from Quaid-e-Azam University and a freelance writer. She can be reached at mariamansab@ir.qau.edu.pk
