Finance Minister Muhammad Aurangzeb on Wednesday said that the government intends to improve Pakistan’s credit rating to ‘Single B’ during the ongoing fiscal year (FY25).

Addressing the 8th Edition of The Future Summit, held in Karachi, Aurangzeb said that the upgradation in credit rating during the first quarter of the fiscal year signifies that “we have moved in the right direction”.

“Hopefully we will move towards a Single B during this fiscal year so that we can rejoin the comity of nations.”

Global credit rating agencies, including Fitchand Moody’s have upgraded Pakistan’s credit rating, following the sovereign’s staff-level agreement with the International Monetary Fund (IMF) on 12 July 2024 for a 37-month Extended Fund Facility (EFF) of $7 billion.

S&P Global keeps Pakistan’s rating at ‘CCC+’, citing reliance on foreign aid

Aurangzeb said that the economic trajectory is moving in the right direction, citing declining inflation rate, policy rate, stable currency and other macroeconomic indicators.“Our twin deficits have turned into surpluses, whether in the fiscal side or the current account,” he said.

“Where we see anomalies, we will come down hard,” Aurangzeb said while informing the attendees that the prices of pulses and chicken will become a standard agenda item in the Economic Coordination Committee (ECC) meeting.

“If you look at these two food items, internationally their prices have declined, petroleum prices have generally decreased in the last six months alongside the transportation cost. How can we have a 50- 60% increase in the prices of pulses and a 15% jump in the price of chicken?

“We will simply not allow middleman arbitrage,” he said. “We’ll ensure that the benefit of the declining inflation rate, which has reduced from 38% to single digits, gets passed to the person on the ground,” he said.

Euro, Panda bonds: Issuance depends on improved credit ratings: Aurangzeb

Regarding the reform agenda, Aurangzeb reiterated that the government remains “absolutely intent to stay the course”.

“Once we are on this roadmap of structural reforms, we need a clear road to market. That is to fundamentally change the DNA of economy towards exports-orientation,” he said.

Aurangzeb said that import substitution cannot continue going forward.

He said that the country to attract FDI, needs to come up with investable, bankable projects. “We have to focus on that FDI going forward, which leads to an exportable surplus,” he said.

Aurangzeb termed population growth and climate change ‘existential issues’ of Pakistan. A population growth of 2.55% “is not a ticking bomb but a bomb that has exploded”, he said while calling for a holistic approach to improve healthcare and education.

“While we are working with our developing partners, my plea to all the local and foreign investors is to please come and partner with us and invest,” he said.