ISLAMABAD: Following the release of a $1.1 billion tranche for Pakistan, the International Monetary Fund (IMF) has identified Pakistan\u2019s economic exposure to the Gulf Coope\u00adration Council (GCC) as its most acute external vulnerability.<\/p>\n
In its staff report, the lender warned that \u201cthe war weighs on the near-term outlook as Pakistan is highly exposed to energy imports and remittances from the Gulf countries as well as to global financial conditions\u201d.<\/p>\n
According to the report, 81 per cent of Pakistan\u2019s fuel imports originate in the GCC region, while 55pc of remittances \u2014 equivalent to about nine percent of the GDP \u2014 flow from these economies.<\/p>\n
The IMF noted: \u201cA significant disruption to the GCC economies and\/or return of migrant workers could weigh on these flows, a major source of financing for consumption and the balance of payments\u201d.<\/p>\n
According to the Fund, the Iran war\u2019s impact has been formally embedded in Pakistan\u2019s macroeconomic projections.<\/p>\n
Under the IMF\u2019s baseline scenario, GDP growth is expected to slow by 0.2 percentage points in FY26 and 0.6 points in FY27, while inflation is pushed up by approximately half a percentage point this year and one and a half points in FY27.<\/p>\n
On Pakistan\u2019s fiscal performance, the report found that programme targets were met, but flagged that the gains were driven by expenditure restraint rather than revenue growth.<\/p>\n
\u201cThe consolidation progress so far has relied primarily on increasing revenue from the formal sector,\u201d the report stated, noting that the Federal Board of Revenue (FBR) missed its end-December indicative target by 0.3pc of the GDP.<\/p>\n
Energy pricing was listed among the prior actions required to complete the review. The government had temporarily delayed fuel price increases after the war began, providing a subsidy to oil marketing companies.<\/p>\n
Additionally, the IMF has formally incorporated the country\u2019s court-mandated transition to an interest-free banking system into its programme monitoring.<\/p>\n
The report said the government\u2019s financial sector strategy must provide \u201ca detailed roadmap for the transition to a constitutionally mandated \u2018riba\u2019 (interest) free economy\u201d and that \u201cthe strategy should establish, without ambiguity, the implementation trajectory for financial institutions and the approach to addressing outstanding conventional liabilities\u201d.<\/p>\n","protected":false},"excerpt":{"rendered":"
ISLAMABAD: Following the release of a $1.1 billion tranche for Pakistan, the International Monetary Fund (IMF) has identified Pakistan\u2019s economic exposure to the Gulf Coope\u00adration Council (GCC) as its most acute external vulnerability. In its staff report, the lender warned that \u201cthe war weighs on the near-term outlook as Pakistan is highly exposed to energy […]<\/p>\n","protected":false},"author":1,"featured_media":18119,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-18118","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-news"],"_links":{"self":[{"href":"https:\/\/weeklyyoung.pk\/index.php?rest_route=\/wp\/v2\/posts\/18118","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/weeklyyoung.pk\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/weeklyyoung.pk\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/weeklyyoung.pk\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/weeklyyoung.pk\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=18118"}],"version-history":[{"count":1,"href":"https:\/\/weeklyyoung.pk\/index.php?rest_route=\/wp\/v2\/posts\/18118\/revisions"}],"predecessor-version":[{"id":18120,"href":"https:\/\/weeklyyoung.pk\/index.php?rest_route=\/wp\/v2\/posts\/18118\/revisions\/18120"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/weeklyyoung.pk\/index.php?rest_route=\/wp\/v2\/media\/18119"}],"wp:attachment":[{"href":"https:\/\/weeklyyoung.pk\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=18118"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/weeklyyoung.pk\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=18118"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/weeklyyoung.pk\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=18118"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}