Pakistan’s economy is confronted with a severe economic crisis characterized by high levels of inflation, low economic activity, low foreign reserves, a depreciating currency, and enormous public finance imbalances. The prevailing political uncertainty is further contributing to the problem. The Federal Budget 2023-24 was presented against this challenging macroeconomic backdrop and a complex political situation. Moreover, the budget has been prepared by an outgoing government as the tenure of the current assembly is set to end on August 13, 2023. Consequently, effective implementation of the policy measures introduced in the budget will depend on the ownership of the future government.
This research report presents an overview of the current state of Pakistan’s economy and analyzes the macroeconomic policy in light of the Economic Survey 2022-23 and the Federal Budget 2023-24. The analyses presented in this report cover several aspects of Pakistan’s economic policy, including recent macroeconomic policies for stabilization and growth, current account balance and international trade, fiscal policy and poverty reduction.
The research was jointly conducted by the Applied Economics Research Centre (AERC), the University of Karachi and the Social Policy and Development Centre (SPDC). AERC and SPDC have recently signed an MoU to develop a long-term relationship between the two institutions to promote collaborative research and enhance knowledge on issues surrounding national development goals to achieve social and economic progress in the country. We sincerely hope that the analyses presented in the report will benefit policy formulators, advocacy groups and civil society.