On a recent Saturday, Finance Minister Muhammad Aurangzeb articulated a resounding plea for economic constancy in Pakistan, emphasizing that the underlying principles governing economic policy must transcend the transient nature of political leadership. “Regardless of which administration occupies the seats of power,” he declared, “the essence of our economic charter pivots on enduring policy continuity.”
The business community, reflecting a unified stance, echoed this sentiment last month, with key stakeholders—the Pakistan Business Council and the Islamabad Chamber of Commerce and Industry—calling for the establishment of long-term economic frameworks intrinsically linked to the pillars of political stability.
During an engaging session with the media at the Overseas Investors Chamber of Commerce and Industry (OICCI) in Karachi, Aurangzeb elaborated, “Investment inflows are not merely forthcoming; they are thriving.” He characterized the current investment climate as “fantastic,” proclaiming optimism about the nation’s economic trajectory.
A pivotal point raised by the finance chief was the urgent need for an economy orientated towards exports. He lamented the existing import-heavy economic structure, arguing, “This imbalance fosters a precarious boom-and-bust cycle and engenders persistent balance of payments challenges. For sustainable growth, we must pivot towards an export-led paradigm.”
He further illuminated that a significant $2.2 billion in withheld dividends and profits had been successfully repatriated within a two-month window earlier this fiscal year, articulating, “We embarked this fiscal period afresh.”
Meanwhile, Planning Minister Ahsan Iqbal has persistently highlighted the necessity for policy consistency to navigate Pakistan back onto a growth trajectory. He stressed that, despite the nation’s abundant resources, political instability stifles progress.
The State Bank of Pakistan, in a stern warning back in May, noted that while macroeconomic indicators showed signs of improvement, the specter of political uncertainty and inconsistent policies continued to loom, exacerbating the economic landscape.
A Call for Private Sector Leadership
Aurangzeb’s discourse was not limited to economic policies alone; it also underscored the urgent need to privatize ailing state-owned enterprises (SOEs). He plainly stated, “The private sector must take the reins to steer this country toward prosperity.”
The finance minister revealed staggering statistics, claiming SOEs inflict a financial burden of Rs2.2 billion daily and account for a monumental Rs6 trillion in losses over the last decade. “Imagine the fiscal equilibrium we could restore if these entities were managed by the private sector,” he asserted.
In line with the International Monetary Fund’s directives, the federal government has initiated a comprehensive strategy for SOEs in 2023, outlining a categorization framework aimed at mitigating economic strain and curtailing financial deficits. This framework mandates relevant ministries to present justifications for the classification of SOEs, distinguishing between “strategic” enterprises pivotal to government functionality and others that could be effectively privatized.
In a landmark move this August, the Cabinet Committee on Privatisation sanctioned the privatization of 24 public sector entities as part of a phased agenda extending from 2024 to 2029. Subsequent discussions led to a decision by the Cabinet Committee on SOEs to retain three federal entities—Trading Corporation of Pakistan, Small and Medium Enterprises Development Authority, and Pakistan National Shipping Corporation—deeming them essential to the public sector.
As these discussions unfold, the imperative for coherent, enduring economic policies coupled with robust private sector involvement becomes ever clearer. The path ahead remains challenging yet ripe with potential for transformative change, should these strategies be diligently pursued.
