Pakistan, U.S. to recalibrate trade relations: FM

April 05, 2025 (MLN): Following recent U.S. tariff changes, Pakistan is preparing a new trade engagement package, with a high-level delegation set to visit Washington in the coming weeks. A steering committee and a dedicated working group have been formed to develop the roadmap for future cooperation.

This was informed by the Finance Minister Muhammad Aurangzeb during a detailed media briefing today. 

Commenting on the ongoing IMF engagement, he said that the ongoing IMF visit is centered on governance reforms rather than budgetary discussions.

He reiterated that the current IMF arrangement reflects Pakistan’s ownership, with the Prime Minister labeling it as the country’s last Fund program—conditional on the achievement of key structural reforms.

He also pointed out that Pakistan’s economy has entered a phase of stabilization, with early signs of recovery visible across key indicators.

Remittances are expected to hit $36 billion this fiscal year, indicating renewed confidence from the global Pakistani diaspora, he added.

The policy rate has been reduced to 12% to provide relief to the industrial sector. Meanwhile, inflation has started to decline, and efforts are underway to pass on the benefits to the public, he added.

The Economic Coordination Committee (ECC) will ensure that the impact of reduced inflation is translated into tangible relief for households, he further said. 

Finance Minister further informed that consumer activity has rebounded strongly, with Eid shopping touching Rs870 billion this year.

The auto sector, which had faced significant headwinds, is now not only recovering but also exporting vehicles—a milestone in Pakistan’s industrial evolution.

As part of broader structural reforms, 24 state-owned enterprises have been lined up for privatization. Bidding for PIA is expected within this month, while flight operations for the airline have already resumed, he informed. 

On tax digitization, Aurangzeb underlined upcoming AI-driven improvements in audit capabilities and simplified return filing procedures, especially tailored to ease the burden on salaried individuals.

He assured that by September, salaried taxpayers would be able to file returns from the comfort of their homes.

The media was also informed that Pakistan has saved Rs1 trillion through improved debt maturity management. On external financing, two separate dialogues are ongoing with China—one focused on loan rollovers and the other on Panda Bonds.

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