The situation of Pakistan’s economy over the previous year has caused some alarm among sections of the public. Independent experts have claimed that the Pakistan Tehreek-i-Insaf (PTI) government’s first year of rule has brought about increased instability and decreasing purchasing power of the average citizen. One of the major shocks inflicted over the past year has been allowing for the country to adopt a more market-based exchange rate. Doing so substantially cut the Pakistani Rupee value in the international market. This in itself is not the government’s fault as it had no other option. Pakistan has had an unhealthy influx of imports compared to dwindling export levels. Still, fears of rising inflation are not wholly unfounded.

The government, however, paints an entirely different picture of the country’s economic fortunes. State Bank Governor, Raza Baqir, claims that moving towards a market-based currency exchange rate was necessary and will lead to greater stability soon. The government has taken a policy route that the state has often feared to take in the past: curb on the rise of imported commodities in cities across Pakistan that causes massive outflows. However, this is only half the work done. Bringing about growth in the economy is only possible if Pakistan increases its production output and takes up a bigger market share, both domestically and internationally.

Contrary to what the ruling party would have us believe, Pakistan is still a long way from stability. Pakistan’s foreign exchange reserves have only increased through borrowing, as they have in the past. Hence, the government cannot yet take credit for stop-gap measures that previous regimes have also employed. The real test comes now; the government has not really decreased the cost of doing business in Pakistan for both foreign and domestic investment. And with increased costs of production in Pakistan’s major exporting sectors such as textile, it remains to be seen whether Pakistan can increase its exports to bring about growth in the long run.