Mr. Zafar Masud (Chairman – Pakistan Banks Association and President & CEO – BOP) and Mr. Sultan Ali Allana (Chairman – HBL) emphasize the importance of the ‘moral economy,’ where societal norms influence economic behavior. Aligning economic practices with ethical standards is essential for improving Pakistan’s socioeconomic landscape.
Pakistan’s agriculture sector is not just a segment of the economy; it is the lifeblood that sustains the country’s populace and fuels its economic engine. With over 37 per cent of the labour force employed in it and its contribution of approximately 46pc to GDP — both directly and indirectly estimated by employing backward and forward linkages between agriculture and other sectors of the economy — agriculture’s significance cannot be overstated. It is a pivotal source of foreign exchange earnings, with a substantial delta as high as $15 billion in our current account, underscoring its role as a cornerstone of Pakistan’s financial stability.
Contrary to the belief that inflationary pressures can be addressed through monetary policy alone, the role of fiscal account policy in managing inflation is being increasingly discussed. Global inflation has remained stubborn, despite unprecedented action by central banks, leading to a debate on the underlying causes of inflation and the effectiveness of conventional tools to tackle it. I believe fiscal policy is the main driver of inflation in Pakistan. Addressing the structural deficits in fiscal policy is critical for inflation to come down.
Victims of Our Own Narrative – “Market knows everything best” is considered the most cogent of arguments by free-market supporters. This may be true in some instances but in most cases it’s unfounded, given the inherent imperfection of markets. While Chicago School orthodoxy says markets produce the best outcomes for society, behavioural economists insist that it’s humans who make markets. This means that humans can strive to improve their functioning.
Opportunities and Pakistan’s Path Forward – Zafar Masud (President & CEO – BOP) gave his outlook analysis for 2024, focusing on different facets, including the economy and reforms, etc., which was published in the Dawn.com newspaper.
Pakistan needs to look at possible actions which can help the country achieve sustainable agriculture and food security. All our actions should have the sole objective of lifting our productivity levels. Some suggested actions are as follows: First, solutions should be home-grown. Agriculture is the most dynamic of all the sectors in the country. But it is laced with more uncharted territories than any other sectors. It is also quite vulnerable to climate change.
Pakistan is an agricultural economy, and it is important to reinforce the real contribution of agriculture to Pakistan’s GDP. While its direct weightage is approximately 23 per cent, its indirect contributions are in the north of 45 per cent. This is based on backward and forward links determined by the ADB between agriculture and other sectors of the economy, as calculated by the Bank of Punjab (BOP) research team in a joint project with PIDE and the Planning Commission.
It’s a misnomer to attribute economic security to one particular institution or allocation of budget and resources. Economic security is synonymous with our people’s welfare and development to me.
The Small and Medium Businesses (SMEs) in Pakistan plays a pivotal role in the country’s economy. They are part of essential building blocks of any economy, which significantly contributes towards employment generation through entrepreneurship resulting into greater social good. With a diverse range of businesses such as Manufacturing, Services, and Agriculture, SMEs are the backbone of Pakistan’s entrepreneurial landscape. Small businesses are undoubtedly significant in terms of their ability to strengthen local communities.
