Pakistan moving from macro-economic stability to sustainable growth: Aurangzeb

KARACHI, Oct 06 (APP): Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, highlighting macro-economic achievements on Tuesday, said that we have come a long way and now we are moving towards sustainable growth.

He was addressing virtually the opening session of the 2-day National SDGs Investment Fair, a 2-day event organized by UNDP Pakistan featuring a pipeline of around 35 investment-ready, SDG-aligned Public-Private Partnership projects spanning transport, energy and climate, agriculture and water, urban development, tourism, and industry and technology.

The finance minister termed macro-economic stability as the basic hygiene factor, strengthening the confidence among the local investors and positive trends in local investment help attracting foreign investment.

Aurangzeb highlighted the significant economic achievements during previous years, saying that we have come a long way and twin deficits shrunk to about 2.6% at the end of June from 12.5% of GDP while the fiscal deficit is a 22-year low and for three years in a row we have had primary surpluses on the external side.

He also highlighted the surge of SBP FX reserves to its highest ever level of $21.4 billion and said that we now have almost three months of import cover, that was about two weeks when we started this journey.

Noting improvement in the GDP growth that is projected at 4% for the current fiscal year, he stressed that we want to go towards growth, but it has to be responsible growth on a sustainable basis.

The minister said that in the privatization process of PIA, a cumulative bid of $1.2 million by the consortium of local investors reflected local investment potential of Pakistan. On the other hand, Pakistan Stock Exchange is performing well with 11 IPOs in the previous fiscal year and five IPOs in the first quarter of FY27 while a number of arrivals is expected.

“When someone is raising equity on the Stock Exchange, they’re obviously looking to either invest, expand their local commercial operations, or set up new units,” he argued and added that Pakistan is moving in the right direction with mobilization of the local investment while significant progress has also been made in foreign investment and recently 3 Turkish companies shown interest in privatization process of Discos.

The finance minister also highlighted the successful launch of the Eurobond and said that it attracted the quality and the length and breadth of investors from the Asian investors to the Middle Eastern, as well as blue-chip European and U.S. investors.

He underscored the role of the private sector, especially public private partnership in economic development of the country and appreciated the PPP model of Government of Sindh.

He informed that under the international climate resilient COP arrangements, the Bridge is now being formalized, and Pakistan is going to be one of the first six countries which have signed up for this bridge while on the policy framework, the country has done relatively well. We would certainly look for that help and support in the context of the bridge, because the bridge is now going to be from ‘what and why’ to the ‘how and who’, he added.

Macro stability provides the external and the fiscal buffers to deal with any untoward situation, he said and added that MDBs, the Country Partnership Framework of the World Bank, ADB, the RSF facility from the IMF were in place while green Panda bonds were also floated. He also mentioned NDCs, NDAs, SBP’s green taxonomy and the Climate Prosperity Plan, and informed that the ESG index was being rolled out in the PSX.

The IMF mission was in Pakistan and things were moving in the right direction, the finance minister informed.

He termed population and climate change as two existential threats for Pakistan and stressed on immediate measures to deal with them. The federal government, the provincial governments, the private sector, all our multilateral partners need to come together to deal with these two existential issues as we go forward,” he maintained.

Appreciating UNDP and the organizers for organizing the investment fair, he hoped that the platform will help frame recommendations and capacity building of relevant institutions in terms of developing investable and bankable projects.

The projects being presented in the fair require a combination of local and foreign investment, he added.

Chairperson of the senate standing committee on Climate Change and Environmental Coordination Senator Sherry Rehman, in her online address, stated that building sustainable cities is a critical need of the hour, while a growing population and migration towards urban areas pose major challenges.

She stated that collaboration between the public and private sectors is proving to be a successful model; specifically, through public-private partnerships, both sectors can combine their resources and regulatory frameworks. She added that the private sector can play a pivotal role in bridging the gap in financial resources and capacity.

In view of mounting climate-related concerns, she termed it vital to formulate projects through public-private partnerships that are financially viable as effective public-private partnerships could play a pivotal role in making development projects bankable.

UNDP’s Deputy Resident Representative in Pakistan Ms Van Nguyen, Senior representatives of all provincial and federal governments, UNDP and other international organizations, and leading corporate and business houses also spoke at the inaugural and following discussion sessions.