With a new government in place, Pakistan’s economy is again at crossroads. In the face of high fiscal and current account deficits, there is a need for continuity of policies to strengthen fiscal discipline and reduce vulnerabilities to external shocks, says an International Monetary Fund (IMF) report.
The IMF also said that expansionary policies and reversal of a number of previously implemented reforms resulted in external imbalances.
Underscoring the need for continuity of policies, the report said that expansionary policies and reversal of a number of previously initiated reforms by the PTI-led government to spur growth had led to external imbalances.
Earlier, the report said that Pakistan’s economy was expected to grow at 5.2 percent in the fiscal year 2017-18 as compared to 5.7pc a year earlier due to a scaling back of infrastructure projects and tight monetary policy stance.
Meanwhile, the government has been pushing for another International Monetary Fund (IMF) bailout package to avert a balance of payment crisis.
The government had sought USD 6 billion from the IMF after initial talks with the Fund failed in March earlier this year, but was offered only half of that amount.
However, it is understood that Islamabad has once again asked for USD 6 billion assistance from the global lender.