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Pakistan’s economy achieved stability following the agreement with the International Monetary Fund (IMF), according to S&P.COM

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Regarding Pakistan, S&P Global Ratings has maintained its “CCC+” long-term sovereign credit rating and “C” short-term rating. Regarding the long-term rating, the prognosis is unchanged.

Pakistan would be able to pay its debts more easily because of the IMF agreement, which is predicted to increase foreign exchange reserves. Rollovers are still necessary for Pakistan to keep up its foreign debt, nevertheless.

Pakistan’s economy will continue to be under pressure from debt obligations, even in the face of stability. The economy may also be impacted by monetary policy, inflation, and uncertain circumstances.

On the other hand, the default risk has decreased due to the growth in foreign exchange reserves. Controlling current account deficits and foreign exchange flows is crucial for preserving economic stability.

To sustain Pakistan’s economic stability, the report stated that funds from the IMF, Saudi Arabia, the United Arab Emirates, and China must be rolled over on schedule.

Positively, Fitch Ratings raised Pakistan’s Long-Term Foreign-Currency Issuer Default Rating (IDR) from “CCC” to “CCC+” on July 29.

The Fitch Company stated in a statement on Monday that “the upgrade reflects greater certainty over the continued availability of external funding, in the context of Pakistan’s staff-level agreement (SLA) with the IMF on a new 37-month USD7 billion Extended Fund Facility (EFF).”

It issued a warning, saying, “Nevertheless, Pakistan’s significant funding needs leave it vulnerable if it fails to implement tough reforms, which could undermine program performance and funding.”

Given the substantial policy changes in the most recent budget for the fiscal year ending in June 2025 (FY25) and the solid track record of support, we think this will be possible.

According to Fitch, Pakistan’s nine-month standby arrangement with the global lender was effectively concluded in April for the last IMF program.

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Irfan Siddiqui meets with the PM and informs him about the Senate performance of the parliamentary party.

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The head of the Senate’s Foreign Affairs Standing Committee and the PML-N’s parliamentary leader paid Prime Minister Muhammad Shehbaz Sharif a visit in Islamabad.

Senator Irfan Siddiqui gave the Prime Minister an update on the Parliamentary Party’s Senate performance.

Additionally, Senator Irfan Siddiqui gave the Prime Minister an update on the Senate Standing Committee on Foreign Affairs’ performance.

He complimented the Prime Minister on his outstanding efforts to bring Pakistan’s economy back on track and meet its economic objectives.

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SIFC Increases Direct Foreign Investment: Investment in the Energy Sector Rises by 120%

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The Special Investment Facilitation Council is intended to help Pakistan’s energy sector attract $585.6 million in direct foreign investment in 2024–2025. The amount invested at the same time previous year was $266.3 million.

This is a notable 120% rise, mostly due to investments in gas exploration, oil, and power. Such expansion indicates heightened investor confidence and emphasizes the development potential in important areas.

The State Bank reports that foreign investment in other vital industries has increased by 48% to $771 million.

This advancement is a blatant testament to SIFC’s efficient investment procedure and quick project execution.

The purpose of the Special Investment Facilitation Council is to establish Pakistan as an investment hub by aggressively promoting regional trade and investment in the energy sector and other critical industries.

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Business

Discos report losses of Rs239 billion.

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When compared to the same period last year, the data indicates that discos have decreased their losses in the first quarter of the current fiscal year.

The distribution businesses recorded losses of Rs239 billion in the first three months of the current fiscal year, a substantial decrease from the Rs308 billion losses sustained during the same period the previous year.

Additionally, the distribution businesses’ rate of recovery has improved. It has increased to 91% in the first quarter of this year from 84% in the same period last year, indicating success in revenue collection.

Regarding circular debt, the Power division observed a notable change. Last year, between July and October, the circular debt grew by Rs301 billion. Nonetheless, this year’s first four months saw a relatively modest increase in circular debt, totaling about Rs11 billion.

These enhancements show promising developments in the electricity sector’s financial health in Pakistan, where initiatives are being made to accelerate recovery rates and slow the expansion of circular debt.

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