State Bank Aims to Raise Foreign Reserves to $13 Billion by June 2025

financial growth and stability representing financial growth and stabilityThe Governor of the State Bank of Pakistan, Jameel Ahmed, has shared a positive outlook on Pakistan’s economic recovery. He emphasized the government’s successful efforts in stabilizing the economy through prudent policies. One of the major targets outlined by the State Bank is to increase foreign exchange reserves to $13 billion by June 2025, reflecting the country’s improving economic health.

Key Developments Highlighted by the Governor

  • Foreign Reserves Growth:
    Jameel Ahmed mentioned that the foreign reserves have grown to $11 billion by September 2024. This is a major improvement from $3.1 billion in January 2023, showcasing the significant progress made over the past year. The central bank is now aiming to reach $13 billion by mid-2025.
  • Declining Inflation:
    The governor explained that inflation peaked at 38% in May 2023 but has since dropped to 6.9% in September 2024 on a year-over-year basis. This reduction in inflation indicates that the tough economic measures taken by the government and the State Bank are producing results.
  • Current Account Improvement:
    The current account deficit has decreased significantly due to higher exports and a rise in workers’ remittances. These factors have contributed to stabilizing the external accounts, strengthening the reserves buffer, and reducing the need for external borrowing.

International Engagements

Governor Jameel Ahmed recently met with global financial institutions and investors during the annual meetings of the International Monetary Fund (IMF) and the World Bank in Washington. In these meetings, he highlighted the following:

  • Stabilization Efforts:
    He credited the State Bank’s monetary policies and the government’s fiscal discipline for restoring economic stability. This combination has helped the country navigate challenges and set a path toward sustainable growth.
  • Positive Outlook for Economic Growth:
    Jameel Ahmed stated that Pakistan’s real GDP growth is expected to improve during the current fiscal year, signaling the revival of economic activities across the country.

Strategic Policies and Future Goals

  • Challenges and Solutions:
    The governor acknowledged that both Pakistan and other emerging economies face global challenges, but stressed the need for continued policy discipline. He also noted that while difficult decisions were necessary, they are now producing favorable results.
  • Debt Reduction:
    He pointed out a decline in public sector debt as a percentage of GDP and a reduction in the country’s external financing needs, which is essential for long-term economic stability.

Future Outlook

The governor expressed optimism about the restoration of economic momentum, expecting stronger GDP growth in the coming months. As the current account stabilizes, the economy is on track for sustainable recovery. With the central bank aiming for $13 billion in foreign reserves by June 2025, the focus remains on building resilience against future challenges.

Economic Indicators

IndicatorDetails
Current Foreign Reserves$11 billion (Sept 2024)
Targeted Foreign Reserves$13 billion (June 2025)
Inflation (May 2023)38%
Inflation (Sept 2024)6.9%
Current Account StatusImproved with higher exports & remittances
Previous Reserve Low (Jan 2023)$3.1 billion

Governor Jameel Ahmed’s statement reflects renewed confidence in Pakistan’s economic policies. With inflation under control, foreign reserves growing, and the current account improving, the country is moving towards economic stability. Achieving the $13 billion foreign reserves target by June 2025 will further strengthen Pakistan’s financial position and reduce dependency on external borrowing.

These developments highlight a turnaround in economic indicators, marking a positive shift in Pakistan’s economic journey. The government and the central bank remain committed to ensuring long-term stability and growth.

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