Aurangzeb rules out consumption-led growth, says tariff reforms will continue

Finance Minister Muhammad Aurangzeb has dismissed the idea of consumption-led economic growth in Pakistan, stating that the country must focus on sustainable, export-led expansion and continue with tariff reforms to boost the competitiveness of its industries. At a seminar in Lahore, Aurangzeb warned against repeating the mistake of import-dependent growth that had previously caused balance-of-payments issues.

He emphasized the government's commitment to tariff reforms to lower the cost of raw materials and intermediate goods for exporters, despite concerns over timing. Aurangzeb highlighted the need for economic growth to create employment, noting that Pakistan's growth has not translated into sufficient job creation compared to its neighbor.

He also discussed global economic challenges, such as growing disparities between oil-exporting and oil-importing nations, and the impact of artificial intelligence on economies. Despite uncertainties, Aurangzeb reported improvements in Pakistan's fiscal and external imbalances, with the twin deficits dropping to 2.6% of GDP. The country's foreign exchange reserves have improved, and IT exports have surged.