Pakistan now heading in right direction: Finance Minister

ISLAMABAD: Finance Minister Miftah Ismail has said the serious worries about Pakistan heading the way of Sri Lanka and getting into a default-like situation, have been averted after significant policy changes and austerity measures.

In an interview with CNBC, he said the high price of energy imports recently pushed Pakistan to the brink of a balance of payments crisis. The Finance Minister said Pakistan’s foreign currency reserves fell as low as 9.8 billion dollars, which were hardly enough for five weeks of imports, while the Pakistani rupee weakened to record lows against the US dollar this year.

He said the global rise in prices of oil, and other commodities caused inflation in the country. However, he said Pakistan is now heading in the right direction. Miftah Ismail said the government has raised taxes, removed unfunded subsidies on oil and power sectors and reduced imports in recent weeks, to push the country out of economic difficulty. He said Pakistani rupee has come back about seven percent or so against the US dollar in the last week.