Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb said that Pakistan's economy had achieved significant macroeconomic stability during the last two years, with the size of the national economy reaching $452 billion and per-capita income increasing from $1,751 to $1,901 billion. He said the government's economic reforms had helped restore stability, strengthen public finances and improve investor confidence despite global economic challenges. He said the policy rate had been …
Budget-Aurangzeb-Speech–2-ISLAMABAD
Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb said that Pakistan’s economy had achieved significant macroeconomic stability during the last two years, with the size of the national economy reaching $452 billion and per-capita income increasing from $1,751 to $1,901 billion.
He said the government’s economic reforms had helped restore stability, strengthen public finances and improve investor confidence despite global economic challenges.
He said the policy rate had been reduced from 22 percent to 11.5 percent during the last two years, while the country’s foreign exchange reserves had improved significantly to reach $17 billion, sufficient to cover three months of import payments.
The minister said overseas Pakistanis continued to play a vital role in supporting the economy, adding that workers’ remittances reached $38 billion during the first 11 months of the current fiscal year and were projected to rise to $41 billion by the end of the current financial year.
Muhammad Aurangzeb said the Federal Board of Revenue’s tax-to-GDP ratio had improved from 8.5 percent to 10.3 percent, while revenue collection during the last three years increased by two percentage points as compared the economic growth.
He said the fiscal deficit, which stood at 7.8 percent of GDP in 2023, had declined significantly due to the government’s reform measures and was expected to fall to four percent by the end of the current fiscal year. The minister said inflation had also eased substantially, averaging 4.5 percent during the current fiscal year compared to 23.4 percent in the corresponding period of the previous year.
He, however, noted that due to the ongoing conflict between the United States and Iran and its impact on international markets, average inflation was likely to remain around 07 percent, though still lower than the government’s earlier projection of 7.5 percent for the current fiscal year.
Muhammad Aurangzeb said the recent increase in inflation was largely driven by developments in the Middle East and expressed confidence that inflationary pressures would ease once the regional conflict subsided. The finance minister said the restoration of financial and economic stability had helped rebuild the confidence of international financial institutions and global investors.
He said leading international credit rating agencies, including Moody’s, Fitch Ratings and S&P Global Ratings, had upgraded Pakistan’s sovereign credit ratings, reflecting improved economic fundamentals.
He said renewed investor confidence enabled Pakistan to re-enter international bond markets after 2022 and issue Eurobonds worth $750 million during the last four years. The minister said demand for domestic bonds remained stable despite global uncertainty, adding that Pakistan had also issued a Panda Bond on the occasion of the 75th anniversary of diplomatic relations between Pakistan and China, enabling the country to become part of one of the world’s largest capital markets.
He said the Pakistan Stock Exchange continued to reflect growing investor confidence and strong corporate performance.
Muhammad Aurangzeb said corporate profitability increased by 22 percent during the January-March 2026 period compared to 09 percent growth recorded earlier, while 173,000 new investors entered the Pakistan Stock Exchange, with a majority comprising young investors.
The minister said 11 Initial Public Offerings (IPOs) were launched during the current fiscal year, the highest number recorded in two decades. He further informed the House that the Securities and Exchange Commission of Pakistan registered 39,000 new companies during the year, reflecting increased business activity and investor confidence.
The finance minister said several leading international companies, including Google, VEON, BYD, Aramco, Alibaba Group, AD Ports Group, Raqmi and Turkish Petroleum, were making investments in Pakistan, demonstrating growing international confidence in the country’s economic outlook.
