Improving Pakistan’s Fiscal Policy: A Blueprint for Sustainable Development and Economic Growth

Abstract

Historically, the fiscal policy of Pakistan has confronted with the challenges like structural inefficiencies, recurring fiscal deficit, and narrow tax base that has impede the sustainable development. Pakistan’s economic performance has experienced upheaval due to the 2022’s flash flooding and consumption-led growth model. However, following the successful completion of International Monetary Fund (IMF) standby agreement have contributed to the early signs of recovery that has improved cash inflows, robust agricultural growth rate of 6.5%, and exchange rate stabilization have collectively promoted economic stability in the FY2024. Nevertheless, primary challenges still persist; this paper through mixed method approach critically analyzes structural inefficiencies and provides findings for policymakers to bolster the Pakistan’s economy. Thus, the Policy recommendations suggest comprehensive measures to achieve economic sustainability.