ISLAMABAD:
Finance Minister Muhammad Aurangzeb on Sunday called the IMF’s recent “Governance and Corruption Diagnostic Report” an opportunity to accelerate institutional reforms, insisting that the assessment should be seen as a catalyst rather than a criticism of government policy.
At a press conference, he said the government itself had requested and facilitated the study as part of its commitment to transparency, and noted that the IMF had recognized progress on taxation, governance, public financial management and procurement.
While many priority reforms were already underway, he added, the remaining recommendations would be advanced to address structural weaknesses that had persisted for decades. “Institutional reform remains essential to sustain Pakistan’s economic recovery,” he said.
Aurangzeb emphasized that structural reforms without institutional strengthening will remain incomplete. He linked this approach to the government’s broader shift towards a private sector and export-led growth model, and cited the abolition of the Export Development Surcharge as a key example of this policy direction.
“The decision to end the 0.25% tax, along with the review of the management of the Export Development Fund, reflected the prime minister’s directive to place the private sector at the center of economic expansion,” he said. He noted that the summary for cabinet approval had already been submitted and its implementation would begin immediately upon approval.
The minister said recent economic indicators pointed to improving momentum: cement production increased by 16%, fertilizers by 9%, oil by 4%, automobiles by 31% and mobile phone manufacturing by 26% between July and October.
Large-scale manufacturing, he continued, grew 4.1% year-on-year in the first quarter, reversing last year’s contraction. He warned, however, that the challenge was to sustain growth without returning to boom and bust cycles driven by external pressures.
Aurangzeb reported that exports had grown 5%, while IT services rose more than 20% year-on-year, recording consecutive monthly highs in September and October. He described the $3.5 billion Reko Diq-related syndication (now financially closed) as a transformative investment expected to generate nearly $3 billion in annual exports once production begins.
Remittances, he said, had reached $38 billion last year and were projected to surpass $41 billion this year, strengthening the current account. “Imports were managed under a reformed tariff regime aimed at improving competitiveness by prioritizing raw materials and intermediate goods, while gradually eliminating protectionism over a period of four to five years.”
