Pakistan plans more panda bonds under 7.2 billion ...

Summary

• Islamabad / Bangkok: Pakistan’s economy grew by 3.7 percent in the last financial year, while the government expects growth to reach around 4 percent in the current financial year, Finance Minister Muhammad Aurangzeb has said, as he outlined plans to increase tax collection, attract foreign investment and reduce the cost of borrowing.
• Both sides also discussed the proposed SCO Development Bank, with China seeking Pakistan’s active participation in consultations and efforts to build agreement on the institution.
• The two sides also discussed the shortage of climate financing, making funds easier to access and helping countries prepare projects that can attract investment.

AI Generated Summary

Islamabad / Bangkok: Pakistan’s economy grew by 3.7 percent in the last financial year, while the government expects growth to reach around 4 percent in the current financial year, Finance Minister Muhammad Aurangzeb has said, as he outlined plans to increase tax collection, attract foreign investment and reduce the cost of borrowing.

Aurangzeb shared the government’s economic plans during meetings with international investors, financial institutions and foreign officials on the sidelines of the World Bank and International Monetary Fund annual meetings in Bangkok, Thailand. He said Pakistan was moving beyond economic stabilisation towards growth driven by investment, exports, technology and private businesses.

The finance minister said tax revenues had increased by 40 percent over two financial years, while the tax to GDP ratio had reached around 10.3 percent. He said the government was continuing reforms to bring more people and businesses into the tax system, improve tax collection and reduce the burden on the economy.

The government has also allocated Rs838 billion to the Benazir Income Support Program to provide financial assistance to vulnerable households. Aurangzeb said economic reforms must be accompanied by targeted support for people who need it, along with efforts to create jobs, improve education and develop skills.

Speaking at a JP Morgan investment seminar, Aurangzeb highlighted improvements in foreign exchange reserves, the current account balance and government finances. He also pointed to continued primary budget surpluses and Pakistan’s renewed access to international financial markets.

He said the government wanted to replace costly, short term borrowing with financing that allowed more time for repayment, without increasing the country’s external debt stock. He reaffirmed Pakistan’s commitment to its IMF program, structural reforms and a careful monetary policy to control inflation.

Aurangzeb said Pakistan was also working to manage energy purchases carefully, support vulnerable families and improve coordination between federal and provincial governments. He stressed that stronger trade and investment partnerships were needed to support lasting economic growth.

In a meeting with Moody’s representatives, the finance minister discussed Pakistan’s sovereign credit rating, recent rating upgrade and improving economic indicators. He said stronger foreign exchange reserves, a controlled current account deficit and lower forward liabilities of the State Bank had helped improve the country’s external position.

Aurangzeb sought Moody’s views on how Pakistan could achieve a stronger credit rating. He also discussed how rating assessments should balance political risks with improvements in economic performance. The government wants to continue reforms and sustain economic progress even after its current IMF program ends.