IMF forecasts 2.5% economic growth for Pakistan amid global inflation concerns

A tea seller waits for customers at his shop in a market in Rawalpindi on June 1, 2023. (AFP/File)
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Updated 11 October 2023
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IMF forecasts 2.5% economic growth for Pakistan amid global inflation concerns

  • According to the latest World Economic Outlook report, Pakistan’s unemployment rate will remain 8.5 percent this year
  • Inflation is projected to reach 29.4 percent in 2023, although it’s expected to ease to 17.5 percent the following year

ISLAMABAD: The International Monetary Fund (IMF) announced on Tuesday Pakistan’s economic growth is projected to hit 2.5 percent this fiscal year, citing global factors such as high inflation and sluggish recovery in its latest World Economic Outlook report.

In recent years, Pakistan has faced severe economic challenges that have been exacerbated by the COVID-19 pandemic and last year’s monsoon floods that led to losses exceeding $30 billion in destroyed homes, farmlands, and public infrastructure.

Additionally, the country saw a significant decline in its foreign currency reserves and a depreciation of its national currency.

To avert the high likelihood of a sovereign debt default, Pakistan secured a crucial nine-month, $3 billion agreement with the IMF in July. However, this deal led to spikes in inflation due to the stringent economic reforms recommended by the international lender.

“Monetary policy actions and frameworks are key at the current juncture to keep inflation expectations anchored,” the IMF noted in its report.

Data presented in the report indicated a significant economic growth jump from -0.5 percent to 2.5 percent in Pakistan this fiscal year, with projections increasing to 5 percent by 2028.

The IMF also expects an unemployment rate of 8.5 percent this year, decreasing to 8 percent by 2024.

Inflation is projected to reach 29.4 percent in 2023, although it’s expected to ease to 17.5 percent the following year.

“The global recovery from the COVID-19 pandemic and Russia’s invasion of Ukraine remains slow and uneven,” the report said at the outset. “Despite economic resilience earlier this year, with a reopening rebound and progress in reducing inflation from last year’s peaks, it is too soon to take comfort.”


Pakistan’s Met Office forecasts ‘severe’ heatwave during Eid Al-Adha holidays 

Updated 05 June 2025
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Pakistan’s Met Office forecasts ‘severe’ heatwave during Eid Al-Adha holidays 

  • High pressure likely to develop over country on June 7, expected to grip most areas from June 8
  • Day temperatures likely to remain 5°C to 7°C above normal from June 7-12 in country’s upper half

ISLAMABAD: The Pakistan Meteorological Department (PMD) on Thursday forecast a “severe” heatwave in the country during the Eid Al-Adha holidays from June 7 to 12, urging the public to take precautionary measures.

Pakistan ranks among the top ten countries most vulnerable to climate change and has faced increasingly frequent extreme weather events in recent years, including deadly heatwaves and devastating floods.

“Met Office predicted that high pressure is likely to develop over the country on June 7 and is expected to grip most parts from June 8,” the PMD said in a statement.

“Day temperatures are likely to remain 5°C to 7°C above normal in the upper half (central & upper Punjab, Islamabad, Khyber-Pakhtunkhwa, Kashmir, Gilgit-Baltistan) from June 7 to June 12.”

Dust storms and gusty winds are expected across the plains of the country due to intense heat, it added.

The Met Office advised women, the elderly and children to avoid direct sunlight during the day and stay hydrated at all times as precautionary moves. 

Farmers were urged to manage their crop activities according to the latest weather conditions and to take care of their livestock.

The Met Office urged authorities to remain vigilant and take necessary measures to prevent any adverse situations arising from the heatwave conditions.

Pakistan experienced its most recent heatwave in May but no loss of life was reported.

In June 2024, nearly 700 people died in less than a week during a severe heatwave in the country, with most fatalities reported in the port city of Karachi and other parts of the southern Sindh province.

A similar heatwave in 2015 claimed over 2,000 lives in Pakistan’s largest city Karachi alone, while catastrophic floods in 2022 left more than 1,700 people dead and displaced over 33 million across the country.


Pakistan defense minister says Simla Agreement with India ‘has no worth’ after conflict

Updated 05 June 2025
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Pakistan defense minister says Simla Agreement with India ‘has no worth’ after conflict

  • As per 1972 agreement, India and Pakistan agreed to resolve Kashmir dispute bilaterally
  • Simla Agreement also formalized de facto border separating Kashmir between two nations

ISLAMABAD: Pakistan’s Defense Minister Khawaja Muhammad Asif said on Thursday that Islamabad’s Simla Agreement with New Delhi, which formalized the de facto border separating the disputed Kashmir territory with its neighbor, “has no worth” after the recent standoff between them.

India and Pakistan signed the Simla Agreement in 1972 after the 1971 war between the two countries, which New Delhi won and led to the creation of Bangladesh. One of its main clauses was that India and Pakistan both agreed to bilaterally discuss and resolve the issue of the disputed Himalayan territory of Kashmir.

Another clause of the agreement was that both countries renamed the Ceasefire Line, the de facto border separating Pakistan-administered Kashmir from the one governed by India, to the “Line of Control” (LoC). Both India and Pakistan agreed not to change it unilaterally.

After India suspended a decades-old water-sharing treaty with Pakistan following an attack in Indian-administered Kashmir in April, Pakistan announced a raft of tit-for-tat measures against Delhi. Islamabad said it had the right to hold all bilateral agreements with India, including the Simla Agreement, in abeyance.

“Because of India’s steps I think the sanctity of the Simla Agreement has ended,” Asif told Geo News. “All the status before the Simla Agreement, that we will resolve problems bilaterally, all of its provisions, is not applicable.

That agreement as a whole, I think after this war and episode, has no worth or value,” he added.

He reiterated Pakistan’s position that India’s move to hold the Indus Waters Treaty (IWT) in abeyance was illegal as the terms dictated that neither of the two parties can alter its status unilaterally.

Signed in 1960, the treaty allocates the six Indus Basin rivers between India and Pakistan, with the World Bank acting as its guarantor.

Pakistan has rights to the western rivers — Indus, Jhelum, and Chenab — for irrigation, drinking, and non-consumptive uses like hydropower. India controls the eastern rivers — Ravi, Beas, and Sutlej — for unrestricted use but must not significantly alter their flow.

India can use the western rivers for limited purposes such as power generation and irrigation, without storing or diverting large volumes

Asif said neither the World Bank nor any other institution had any “interference or patronage” in the Simla Agreement when it was signed in 1972.

“So then, the Control Line will once again shift to its original status of Ceasefire Line,” the minister said.

While the fragile ceasefire between India and Pakistan announced on May 10 by US President Donald Trump -persists, tensions remain high as delegations by both nuclear-armed neighbors head to world capitals and blame each other for the May conflict.

Kashmir has always remained the root cause of conflict between India and Pakistan. The two countries claim the region in full but administer only parts of it. They have fought two out of three wars since 1947 over the territory.

Delhi blames Islamabad for fomenting militancy in the part of Kashmir it administers. Pakistan denies the allegations and says it only extends diplomatic support to the people of Kashmir it says are living under “occupation.”


Pakistan PM embarks on two-day Saudi Arabia visit to bolster bilateral ties

Updated 05 June 2025
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Pakistan PM embarks on two-day Saudi Arabia visit to bolster bilateral ties

  • During his stay on June 5 and 6, Sharif will celebrate Eid Al-Adha, hold bilateral meeting with Crown Prince Mohammed bin Salman
  • Discussions are expected to focus on enhancing cooperation in trade, investment and regional security, welfare of Muslim Ummah

ISLAMABAD: Pakistani Prime Minister Shehbaz Sharif departed on Thursday on a two-day official visit to Saudi Arabia at the invitation of Crown Prince and Prime Minister Mohammed bin Salman to strengthen bilateral relations between the two longstanding allies, the premier’s office said. 

During his stay on June 5 and 6, Sharif will celebrate Eid Al-Adha in the Kingdom and hold a bilateral meeting with Crown Prince Mohammed bin Salman. The discussions are expected to focus on enhancing cooperation in trade, investment and regional security.

“The two leaders will discuss ways to further strengthen bilateral cooperation in various fields, including trade and investment, welfare of the Muslim Ummah, and regional peace and security,” according to a statement from the Prime Minister’s Office.

Sharif is also expected to express gratitude to the Saudi leadership for their role in de-escalating recent tensions between Pakistan and India. 

Last month, following the worst military confrontation between India and Pakistan in decades, Saudi Arabia, along with other Gulf nations, played a key role in mediating between the two nuclear-armed neighbors, helping to avert a potential war. 

The visit also comes amid deepening economic ties between Pakistan and Saudi Arabia. In recent months, the two countries have signed multiple agreements aimed at boosting bilateral trade and investment. Notably, Saudi Arabia has committed to a $5 billion investment package to support Pakistan’s economy, which has been grappling with a balance of payments crisis.

Last year, Saudi and Pakistani businessmen signed 34 memorandums of understanding worth $2.8 billion, covering sectors such as industry, technology, and agriculture. Additionally, Saudi Arabia’s Manara Minerals is in talks to acquire a 10-20 percent stake in Pakistan’s $9 billion Reko Diq copper and gold mining project, one of the largest of its kind globally.

Defense cooperation is also a key component of the bilateral relationship. The two nations have a history of military collaboration, with Saudi Arabia providing support to Pakistan during times of regional tension and Pakistan training Saudi forces. 

Pakistan has a 2.7 million-strong diaspora in Saudi Arabia, which accounts for the highest remittance inflow, a crucial lifeline for the country’s economy.


Pakistani pilgrims pray for Palestinians, Muslim world on sacred Day of Arafat

Updated 05 June 2025
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Pakistani pilgrims pray for Palestinians, Muslim world on sacred Day of Arafat

  • Over 117,000 Pakistanis have joined millions of Muslims from around the world in Arafat to seek forgiveness
  • Pilgrims express satisfaction with facilities provided by Pakistan’s Hajj mission supported by Saudi authorities

ISLAMABAD: Pakistani pilgrims on Thursday vowed to pray for Palestinians and the wider Muslim world as they joined over a million fellow worshippers in Arafat on one of the most sacred days in Islam to seek forgiveness.

The Day of Arafat, observed on the 9th of Dhu Al-Hijjah, the final month of the Islamic calendar, marks the spiritual peak of the annual Hajj pilgrimage. Its central ritual, Wuquf, involves standing in devotion from noon until sunset near Mount Arafat, where the Prophet Muhammad (PBUH) delivered his farewell sermon.

After sunset, pilgrims travel to Muzdalifah, located between Arafat and Mina, to collect pebbles for the symbolic “stoning of the devil” ritual performed the following day.

“It is a big day for the Muslims around the world and those who are present here,” Pakistan’s Minister for Religious Affairs Sardar Muhammad Yousaf said while speaking to media from Mount Arafat.

“I urge Pakistani pilgrims that along with praying for their own families, they should also pray for the country, Muslim Ummah, especially people of Gaza, Palestine and Kashmir,” he added.

Malik Aslam, a Pakistani pilgrim from Gujar Khan, a city in Rawalpindi District, said the situation in Gaza was deeply disturbing and that he would pray for Palestinians.

“All pilgrims should pray for all the Muslims, especially those in Palestine,” he told Arab News. “Pilgrims should pray for the success of Muslims in all fields.”

“I am also praying for my parents and all those who left this world,” he added.

Expressing his feelings from Mount Arafat, Muhammad Usman, another pilgrim from Gujrat district in Punjab, said he was thankful to God for blessing him with the opportunity to perform Hajj.

“Today, I am reflecting on my entire life and praying that Allah grant me a better, righteous life ahead,” he told Arab News, saying he would begin a new chapter of life after Hajj.

“I hope to leave here with all my known and unknown sins forgiven,” he added.

Muhammad Abdullah, from Mardan in Khyber Pakhtunkhwa province, said his day was going well, as the weather was not too hot.

“I will pray for the whole Ummah, following example of our Holy Prophet [PBUH],” he added.

Speaking about the arrangements, Samad Wazir, a pilgrim from the northwestern Waziristan tribal district, expressed satisfaction with the facilities provided by both the Pakistani Hajj mission and Saudi authorities, hoping the same standard would continue in the coming days.

“It is very well arranged and there has been no problem at all in the tents and other places,” he said, adding that everyone had their own folding beds and received meals on time in the tents.

“Even on the buses, the arrangements were smooth, as everyone boarded in turn with the help of Hajj volunteers, who also guided us all the way to our tents,” he added.

Munir Ahmed Bhatti, a pilgrim from Gujranwala city, also praised the Pakistani mission for the arrangements in Mina and Arafat.

“We gathered for Hajj and this time the government of Pakistan has done very good arrangements and we are satisfied,” he said, adding that pilgrims got good residences, food and transportation.

Over 117,000 Pakistani pilgrims are currently in Saudi Arabia for Hajj 2025.


Pakistan’s Punjab grants 90-day sentence remission to 450 prisoners ahead of Eid Al-Adha

Updated 05 June 2025
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Pakistan’s Punjab grants 90-day sentence remission to 450 prisoners ahead of Eid Al-Adha

  • A total of 270 prisoners will be released from jails to celebrate Eid Al-Adha with their families
  • Sentence remissions are traditionally announced on religious, national occasions in Pakistan

ISLAMABAD: Around 450 prisoners in Pakistan’s populous Punjab province have been granted a special 90-day remission in their sentences ahead of Eid Al-Adha, the Punjab government announced on Thursday.

Pakistani leaders traditionally announce sentence remissions for prisoners on religious festivals and other special occasions like Independence Day.

These remissions are intended as goodwill gestures to promote rehabilitation and allow selected inmates to reunite with their families during important national and religious occasions.

“Prisoners in Punjab’s jails have been given a special 90-day sentence remission,” the Punjab administration said in a statement, adding “450 inmates will benefit” from the decision.

Two hundred and seventy prisoners out of 450 will be released from Punjab’s jails and be able to celebrate Eid with their families, it added.

The sentence remission was granted by the Punjab government under Rule 216 of the Pakistan Prison Rules, 1978.

Prisoners convicted of militancy, sectarianism, espionage, treason, anti-state activities, murder, rape, drug trafficking, robbery, kidnapping, financial embezzlement or causing loss to the national treasury, as well as those punished for violating jail rules within the past year, will not be eligible for sentence remission.

Earlier this year in March, President Asif Ali Zardari announced a special 180-day remission in sentences for eligible prisoners on the occasion of Eid Al-Fitr.

He had also approved similar remissions for prisoners on Pakistan Day and Eid Al-Fitr last year.