ISLAMABAD: Fitch Ratings has forecasted that the current government led by Pakistan Muslim League (N) (PML-N) will remain in power for the next 18 months.
In its report on Pakistan, Fitch also predicted that the founder and chairman of Pakistan Tehreek-e-Insaf (PTI) will remain in custody in the near future.
The report highlighted external payment pressures as a significant economic risk for Pakistan’s economy. It noted that the inflation rate might decrease by the end of the current fiscal year.
Fitch observed that the Pakistani government has set extremely challenging economic targets in its budget, aiming to reduce the fiscal deficit from 7.4% to 6.7%.
The report suggested that the State Bank of Pakistan (SBP) might lower the interest rate to 14% by the end of the current fiscal year.
According to Fitch, the Pakistani government’s tough economic decisions are paving the way for a program with the International Monetary Fund (IMF).
Fitch forecasted that the current government would implement all necessary economic reforms in collaboration with the IMF. If the current government ends, a technocrat government is likely to take over in Pakistan.
The report also mentioned that independent candidates achieved significant success in Pakistan’s February elections, with support from the imprisoned PTI chairman.
Fitch warned that protests in Pakistani cities could disrupt economic activities. Additionally, it identified floods and droughts as economic risks for Pakistan’s agriculture sector.
