Pakistan to grow at 2pc, face 25pc inflation: IMF

Notwithstanding a relatively better global outlook, the International Monetary Fund (IMF) on Tuesday maintained Pakistan’s economic growth prospects for the current fiscal year at two per cent, which it had revised downward in January from its previous estimate of 2.5pc. In its flagship World Economic Outlook (WEO 2024), released on Tuesday, the IMF kept the country’s growth rate at 3.5pc for the next fiscal year. In January, the Fund had lowered the current year’s growth rate by 0.5pc from 2.5pc and by 0.1pc from 3.6pc for FY25, which it anticipated in October 2023. The growth estimates are based on the Fund’s recent quarterly review of Pakistan’s macroeconomic position as part of the $3bn Stand-By Arrangement (SBA) on which the two sides reached a Staff-Level Agreement (SLA) on March 20. The IMF forecast is slightly higher than projections made by its Washington-based cousin — the World Bank — at 1.8pc early this month. The IMF’s growth forecast is significantly lower than the government’s 3.5pc GDP growth target for the current year but generally in line with the State Bank of Pakistan’s expectation of 2pc to 3pc announced last month as part of the Monetary Policy Statement.