ISLAMABAD – The Ministry of Finance has warned that escalating tension in domestic political situation could hamper the economic recovery of Pakistan and aggravate macroeconomic imbalance.
The warning comes as Prime Minister Imran Khan is facing a no-confidence motion tabled by Opposition in the National Assembly on Monday and Pakistan hopes to get next tranche of a $6 billion from the International Monetary Fund to rise the declining foreign reserves.
In a bid to survive the no-confidence motion in the Centre, the ruling party announced to give the post of the Punjab chief minister to PML-Q, the PTI’s key ally in the federal government.
“Domestic political conditions are building domestic risks,” the finance ministry pointed out in its outlook for March 2022.
“A further escalation of these risks could jeopardize the positive outlook for Pakistan’s economy and may also aggravate the macroeconomic imbalances.”
“The intensity of internal and external risks has still not been exactly realized which may adversely affect domestic economic activities,” the report added.
The ministry also predicted that year-on-year inflation is expected to remain between the 9.5 to 11.5% in the country.
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