Nebulous hopes for the future

With political unrest, the economic activity in Pakistan is weakening further. Depressingly bleak outlook of the global economy compound worries of the country’s business class that desperately wishes for economic recovery and for the political chaos to end but not militarily. In Pakistan, inflation is currently skyrocketing, the external sector is under grave stress, currency value is eroding, and recent floods and their fallouts drowned whatever was left of hope. The monetary tightening and curbs on imports posed new challenges for businesses. The annual inflation rate hiked to 27.3 per cent from 9.5pc last year and 5.8pc in 2018 — the last election year. The net foreign exchange reserves with the State Bank of Pakistan stood at $7.9 billion on 4th November 2022, barely sufficient to finance 40 days of the import bill. Hard currency is short in supply, and the Pakistani rupee was trading at Rs227.5 last Friday in the open market. It was Rs171 the same week a year back and 134 in the second week of November 2018.