ADB, SBP launch Women Finance Code
He was speaking at the launching ceremony of the Women Entrepreneurs Finance Code in Karachi, organised jointly by SBP and the Asian Development Bank (ADB). The event featured national and international dignitaries, who expressed solidarity with the important cause of women's economic empowerment.
Jameel Ahmad, in his keynote address, said that both SBP and the government remain steadfast in their approach to transitioning from the recently hard-earned economic stability to medium-term economic transformation. "This resolve is reflected in our prudent and cautious monetary policy stance, fundamentals-aligned exchange rate, ongoing fiscal consolidation and improving debt dynamics."
He added that this approach is helping to ensure overall macroeconomic stability, building fiscal and external buffers and supporting sustainable economic growth.
With focus now increasingly shifting towards structural reforms, the governor believes that this time is indeed different for Pakistan's economy due to the following facts:
The average headline inflation has declined to 4.5% in FY25 – the lowest level in nine years – and with prudent and coordinated mix of monetary and fiscal policies, the inflation will stabilise within its target range of 5-7%.
The foreign exchange market remains stable driven by external account outperformance and a high-quality buildup of forex reserve buffers. SBP's reserves are now almost five times higher than the low levels witnessed at the start of 2023.
The current account balance is projected to remain supportive, driven by robust remittances and resilient exports, despite rapid growth in both the value and volume of imports in line with the ongoing economic recovery.
Fiscal policy has proactively supported monetary tightening, as reflected in the second consecutive primary surplus in FY25. Both tax and non-tax revenues have shown sizable growth, while overall expenditures have remained relatively contained. The government is targeting a higher primary surplus for FY26. Economic growth is showing signs of gradual, consistent and sustainable recovery.
Ahmad said that unlike in the previous episodes of boom-bust cycles, the current policy mix remains conducive to a lasting increase in economic activity rather than a short-sighted, fragile and populist "sugar rush".
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Express Tribune
17 hours ago
- Express Tribune
ADB assesses feasibility of financing ML-1 project
Listen to article Experts from the Asian Development Bank (ADB) on Saturday inspected the Karachi to Rohri railway line, which forms a key section of the long-delayed Main Line-1 (ML-1) up-gradation project. ADB Chief Transport Planner Sangyoon Kim, accompanied by Pakistan Railways' chief engineer open lines, examined the 480-kilometre track. Senior railway officials including infrastructure specialists, divisional superintendents of Karachi and Sukkur and other representatives were also present. The ADB team is expected to meet the chief executive officer of Pakistan Railways, the additional general manager for infrastructure and Chinese experts currently working on the ML-1 project. According to officials, the ADB's fact-finding specialists are preparing a detailed report to assess the feasibility and potential of financing the Karachi-Rohri segment, which is part of the first ML-1 package. The proposed upgrading is vital not just for improving the country's railway system but also to support key economic projects. The completion of this section will ensure smoother and faster transportation of coal from Thar and easier access to strategic mineral resources like those in Reko Diq. The ML-1 project has been in the pipeline for nearly two decades. Its first feasibility report was prepared in the early 2000s but progress remained slow due to the lack of political will and consistent financial constraints. The project regained momentum after the launch of the China-Pakistan Economic Corridor (CPEC) project in 2015, when ML-1 was included as a strategic infrastructure scheme. Initially, China had shown keen interest in financing the entire ML-1 through concessionary loans. However, in later years, Beijing became hesitant, mainly due to Pakistan's worsening financial health, concerns over loan repayments and delays in other CPEC-related projects. The original ML-1 stretches over 1,872 kilometres, running from Karachi to Peshawar and passing through major cities like Hyderabad, Rohri, Multan, Lahore and Rawalpindi. It connects over 90 railway stations and has the capacity to handle more than 75% of passenger and freight traffic. Once completed, the project is expected to transform Pakistan Railways by reducing travel time by half, improving safety standards, increasing train speed up to 160 km per hour and significantly boosting freight capacity. It is expected to turn the country's outdated rail network into a modern, reliable and efficient transport system. Initially, the cost of upgrading ML-1 was estimated at around $6.8 billion. However, due to changing designs, economic instability and currency depreciation, the financial estimate has been revised multiple times. The current estimated cost is around $6.6 billion, though further changes are possible depending on scope adjustments and financing terms. China's reluctance to move forward with ML-1 financing has led Pakistan to approach other lenders, including the ADB. While the ADB has not yet committed funding for the entire project, their recent inspection and meetings indicate a strong interest in exploring different possibilities. Officials believe that if Pakistan is able to present a well-structured proposal and show improved project management capacity, the ADB may step in either fully or partially to fund initial phases. Pakistan Railways views ML-1 as a turning point for the sector's revival, but it is still unclear whether international lenders will step forward at a time when China has apparently pulled back. According to the officials, it will take some time – no one knows how much – before the ADB decides whether to finance the project or not, however, the railways at all levels is trying its best to get financing either entirely or partially, as train derailments in some sections are now becoming a routine, resulting in less passenger traffic.
Express Tribune
2 days ago
- Express Tribune
REER improves to 96.6 in June
Listen to article The Real Effective Exchange Rate (REER) index for the Pakistani rupee improved to 96.6 in June 2025, down from 97.8 in May 2025, according to data released by the State Bank of Pakistan (SBP). The drop in REER suggests improved external competitiveness for the rupee. The rupee also appreciated slightly against the US dollar on Friday, gaining 0.04% in the interbank market. It closed at 284.87, up by 10 paisas from Thursday's closing rate of 284.97. In parallel, the SBP injected Rs11.05 trillion into the banking system through Open Market Operations (OMOs) on Friday, using both conventional and Shariah-compliant instruments. The bulk came through the conventional reverse repo OMO, with Rs11.371 trillion accepted. Most of this was in the 14-day tenor (Rs11.2 trillion at 11.03%), and a smaller portion in a 7-day tranche (Rs171.1 billion at 11.09%). Under the Shariah-compliant Mudarabah-based OMO, Rs115.5 billion was accepted, split between 7-day (Rs100 billion at 11.11%) and 14-day (Rs15.5 billion at 11.13%) tenors. These operations reflect SBP's focus on short-term liquidity management. Rates ranged from 11.03% to 11.13%, suggesting stable interbank market conditions. The pro-rata acceptance in some tenors points to selective liquidity control to balance market needs. Analysts view the scale of the injection as a sign of adequate banking liquidity. The slightly lower OMO rates may signal a shift towards monetary easing. Meanwhile, the APGJSA, said the price of gold per tola rose by Rs2,500 to Rs357,600 on Friday. The price of 10 grams increased by Rs2,143 to Rs306,584. A weaker US dollar and geopolitical uncertainty boosted gold's appeal as a safe-haven asset. Platinum prices, however, retreated after recently hitting a decade high.
Business Recorder
2 days ago
- Business Recorder
C/A posts surplus of over $2bn after 14 years
KARACHI: Pakistan's current account balance recorded a surplus of over 2 billion dollars in the last fiscal year (FY25) for the first time in 14 years, driven by a substantial increase in workers' remittances. The State Bank of Pakistan (SBP) on Friday reported that Pakistan has achieved a current account surplus of $2.1 billion in FY25 as against a deficit of $2.1 billion in the previous year (FY24). Khurram Schehzad, Advisor to the finance minister, has said that annual current account surplus has been recorded after a gap of 14 years, and the largest surplus in 22 years. He termed it a key development on the external front of Pakistan's economy, adding that the overall economic performance is encouraging and the country is on the right track due to appropriate policy measures. Monthly basis, the current account balance for the last month (June) of FY25 also posted a surplus of $328 million, compared to deficit of $500 million in June 2024. In addition, current statistics of June 2025 are also better than May 2025, in which the country posted $84 million deficit. Economists attribute this improvement to robust policy measures and consistent efforts by the federal government and the SBP to strengthen the external account and channel remittances through formal avenues. They said that all time high inflows of remittances is the major factor was behind the current account surplus in the last fiscal year. 'The remarkable shift was primarily fuelled by a sharp rise in workers' remittances, which provided crucial support to the external account,' they added. In a historic economic milestone, with a significant 27 percent growth, Pakistan recorded its highest-ever home remittance inflows, exceeding $38 billion during the last fiscal year FY25. According to SBP, Pakistan's trade deficit widened by $4.6 billion to $26.78 billion in FY25, compared to $22.18 billion in FY24. The increase was primarily driven by a higher import bill amid a pickup in economic activity. During the period under review, import bill increased by 11 percent to $59 billion from $53 billion. Exports also posted 4 percent or $1.295 billion growth to reach $32.295 billion in FY25 from $31 billion in FY24. Khurram Schehzad said that Real Effective Exchange Rate (REER) index has also dropped further to 96.6, rendering PKR more competitive against US$, which should support country's exports and keep external account in check. In addition, Pakistan Stock Market continues to be in the top Global rankings, currently 4th best globally Jul-25 to date, he said and added that on Friday Pakistan Equities Market (KSE-100) also crossed 140,000 points during the intraday trading, making a historic mark in its history, with market value crossing Rs 16.8 trillion (close to $60bn). Copyright Business Recorder, 2025
