KARACHI: Reform agenda agreed under International Monetary Fund (IMF) 37-month Extended Fund Facility (EFF) is likely to accelerate growth in Pakistan, said Asian Development Bank (ADB).

As per Asian Development Outlook report for September, growth in Pakistan rebounded to 2.4 percent and inflation proved lower than expected in FY2024.

"Economic activity was boosted by fiscal discipline, market-determined exchange rate, energy sector efficiency, climate resilience and an improved business environment," it added.Report noted that higher income from agriculture and increased remittances bolstered private consumption, while improved crop production curbed rise in food prices in Pakistan. ADB was of view that comprehensive economic reform programme supported by IMF is projected to increase growth, expected to grow by moderate 2.8 percent and reduce inflation in FY2025. "Private investment should rebound on more favorable macroeconomic conditions, including easier access to foreign exchange. This will also benefit manufacturing and services," ADB's outlook noted. Meanwhile, ADB report highlighted concerns that higher personal income tax rates in FY2025 budget and government's efforts to limit spending will constrain private and public consumption.

"In addition, growth in agriculture is projected to slow in FY2025 as higher administered prices for gas and lower subsidies raise cost of fertiliser," it said. "Inflation in 2025 is expected to moderate to 15.0 percent, supported by tighter monetary policy and more stable global commodity prices," global lender projected.