A highlight of Aurangzeb’s weeklong visit was his meeting with members of the US-Pakistan Business Council hosted by Masood Khan, Pakistan’s Ambassador to the United States
Aurangzeb Assures Pakistani-American IT Companies of Resolution of Problems
By Elaine Pasquini
Washington: Pakistan’s newly appointed finance minister Muhammad Aurangzeb arrived in the United States on April 14, 2024, to meet with International Monetary Fund (IMF) and World Bank officials at their Washington, DC headquarters during their spring meetings to discuss Pakistan’s ongoing economic crises.
Welcoming the IMF’s renewed focus on capacity building via Regional Capacity Development Centers (RCDC), tailored to each region’s priorities, Aurangzeb emphasized the importance of collaborative efforts for sustainable economic development.
In the minister’s meeting with US State Department officials Donald Lu and Elizabeth Horst, Washington’s commitment to bolster Pakistan-US ties was reaffirmed.
During his US visit, Aurangzeb also held bilateral discussions with the finance ministers from Türkiye, Saudi Arabia, China, and the UAE. He also met with Andrew Mitchell, the UK’s Minister of State for Development and Africa, who recognized the Pakistan-UK partnership in education, health, and finance.
The minister conveyed his condolences and those of the leadership and people of Pakistan to Chinese Finance Minister Lan Fo’an on the terrorist attack on Chinese nationals in Pakistan and reaffirmed his commitment to their safety and security. Calling China an “all-weather friend,” he lauded China’s invaluable contribution to the development of Pakistan through initiatives such as the China-Pakistan Economic Corridor (CPEC).
He informed Lan Fo’an that Pakistan was entering into a larger and extended IMF program and looking forward to China’s continued support. Aurangzeb also briefed his counterpart on Pakistan’s priorities, including broadening the tax base, fixing the energy sector, and over-hauling the state-owned enterprises. Pakistan, he said, aimed to tap into the Chinese bond market and launch Panda Bonds during the fiscal year 2025-26.
Both ministers agreed on the need to continue their cooperation within international institutions, reflecting deep-rooted economic ties between their two countries.
Aurangzeb had the opportunity to have conversations with Masatsugu Asakawa, president of the Asian Development Bank, and Mohamed Nasheed, former president of the Maldives, who is presently Secretary-General of the Climate Vulnerable Forum.
One highlight of Aurangzeb’s weeklong visit was his meeting with members of the US-Pakistan Business Council hosted by Masood Khan, Pakistan’s Ambassador to the United States. Speaking to the organization’s businessmen and entrepreneurs, Aurangzeb acknowledged the determination of Pakistan’s government to attract domestic and foreign investment. Areas of interest attractive to foreign investors, he pointed out, include agriculture, information technology, mineral extraction, and energy sectors. The government is committed, he added, to improving the ease of doing business for foreign investment by fast-tracking and streamlining the approval process.
The minister praised the Pakistani diaspora’s contributions to the country’s socio-economic development and urged them to invest in their homeland. He assured them full support for the resolution of problems being faced by the IT companies doing business in Pakistan. Poor broadband infrastructure has been one obstacle for emerging IT companies in the country.
In addition, while in Washington, Aurangzeb was a special guest on the Atlantic Council’s (AC) IMF Bank Week program where he continued to speak on Pakistan’s efforts to resolve its economic problems.
In introductory remarks, AC president Frederick Kempe noted the minister brought 35 years of international banking experience to his position, which he began in March this year, pointing out that his leadership skills will be fully utilized during his tenure.
“Minister, you are known to be a transformative leader and one who likes to face crises head-on,” Kempe said. “You represent the potential of Pakistan’s economy. With a young population, Pakistan stands at the cusp of transformative economic growth. The nation’s journey toward economic stability is not just crucial for South Asia but for the global landscape.”
Program host Kapil Sharma of the AC’s South Asia Institute questioned the minister about his country’s current economic landscape and his meetings with IMF officials.
“We have certainly entered this year in much better shape than we were at the beginning of last year,” Aurangzeb responded. This was due in great part to the IMF’s nine-month Standby Agreement, which “ushered in a macroeconomic stability for the country,” he added. “Overall, our GDP is moving in the right direction… Inflation has decreased from 38 percent to closer to 20 percent and the exchange rate is stable.”
All of this has moved Pakistan in the right direction. But now, he said, “In the first instance, we need permanence in the macroeconomic stability, hence the discussions with the Fund [IMF] on a larger and extended program, but also we are going to be focused on the growth aspects of it as well when we look into 2024.”
With respect to his meetings with the IMF, he acknowledged that Pakistan’s government has been aware of the need to raise the country’s GDP, increase exports, get the circular debt in order, and accelerate the privatization agenda. “Now it’s time for us to actually start moving with the execution of some of these aspects,” he insisted. The reason Pakistan is “looking for a wider extended IMF program is that once we get into execution mode…we will need a two-to-three-year time period so we can actually go through the structural reforms.”
Sharma related that in a recent Atlantic Council program, IMF chief Kristalina Georgieva stated that “Pakistan was successfully completing its existing program with the IMF and its economy was performing somewhat better with reserves now being built up. There is a commitment to continue on this path and the country is turning to the Fund to potentially having a follow-up program.”
Tax collection, public spending, and a transparent environment, however, were areas that Georgieva said needed improvement, Sharma added. And that “execution” was key to everything.
Poised to enter into Pakistan’s 25th IMF program, Aurangzeb agreed that “execution” was most important and stressed that “what we sign we will deliver.” Pakistan is determined to build on the achievements of the previous nine-month program “and continue with respect to the same discipline,” he said.
(Elaine Pasquini is a freelance journalist. Her reports appear in the Washington Report on Middle East Affairs and Nuze.Ink.)
