There is some semblance of macroeconomic stability in Pakistan as inflation decreases, interest rates fall, and the currency stabilizes, primarily due to domestic and global high base effects. However, achieving sustainable economic growth remains elusive, and there is little interest in new investments.

Three crucial variables need addressing to revive economic growth and encourage investment: lowering energy prices (particularly power tariffs), reducing taxation, and ensuring political stability. Without these measures, even if inflation drops to the anticipated 5-8 percent and interest rates are further reduced, it will not be enough to spur meaningful growth.

The most immediate and impactful measure is reducing energy prices. Many sectors, particularly export-driven ones, are hesitant to fully utilize their capacity because the marginal cost of production exceeds selling prices. Forcing older Independent Power Producers (IPPs) to revise contracts is counterproductive, as it discourages investment and undermines the potential for privatization and deregulation in the........

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