Pakistan needs 'careful' economic management to get macroeconomic stability: World Bank.

ISLAMABAD -- The World Bank (WB)on Tuesday suggested Pakistan to under take the much-needed fiscal reformsincluding a reduction in tax exemptionsand a broadening of the tax base, termingthem "critical" for economic stability andsustainable economic growth.

"Careful economic management and deepstructural reforms will be required toensure macroeconomic stability andgrowth," WB Country Director forPakistan Najy Benhassine said whilelaunching "Pakistan Development Update(PDU): Restoring Fiscal Sustainability."With inflation at record highs, rising elec tricity prices, severe climate shocks, andinsufficient public resources to financehuman development investments and cli mate adaptation, he said."It is imperative that critical reforms areundertaken to build the fiscal space andpublic means to invest into inclusive sustainable, and climate-resilient development."According to the WB report, Pakistan's economy slowed sharply inFY23 with real Gross Domestic Product (GDP) estimated to havecontracted by 0.6 per cent.

"The decline in economic activity reflects the accumulation ofdomestic and external shocks including the floods of 2022, govern ment restrictions on imports and capital flows, domestic politicaluncertainty, surging world commodity prices, and tighter globalfinancing." It said.The report stated that the previous fiscal year ended with signifi...