Management of an economy in the modern era due to its connectivity with the global economic environment and a host of convoluted factors on the internal front is indeed an arduous task, particularly in countries like Pakistan hamstrung by resource constraints, a well-entrenched culture of tax evasion and political resistance to economic reforms. Nevertheless, it is encouraging to note that against all odds, Pakistan’s economy is far better off at the moment than in 2013 due to some prudent management by the present government. It is not only the claim of the government but the revival of the economy has been repeatedly endorsed by almost all major international lending and rating agencies. A global rating agency, Standard and Poor’s, raised Pakistan’s long-term sovereign credit ratings to B from B-negative on Monday based on an improved economic outlook. The assessment report of the agency stated: “The outlook on the long term rating is stable. Pakistan’s policy making, in our view, has improved the performance of the economy and the prospects for country’s fiscal and external positions.” The agency revised upwards its forecasts of average GDP growth to five percent over 2016-19 from the earlier estimate of 4.7 percent, maintaining that further gradual gains in fiscal consolidation would lead to fiscal deficits of below three percent of GDP by 2018 through tax changes and addressing of expenditure-side rigidities. The director general of the IMF, on a visit to Pakistan during the last week of October, addressing a seminar organised by State Bank of Pakistan, also stated unequivocally that Pakistan was out of its economic crisis. When the Pakistan PML-N government was installed in May 2013, the economy was on the verge of collapse. The country faced a severe energy crisis. Economic growth was below three percent, inflation was at double digit, interest rates were high, budget deficit was at 8.8 percent of GDP, investments were abysmally low, foreign currency reserves stood at the lowest ever level, and the country faced the prospect of an ignominious default on IMF loans. Three years down the line, the profile of the economy is quite encouraging. The fact that the budget deficit, which is considered the mother of all economic woes, has been brought down from 8.8 percent of GDP in 2013 to 4.3 percent in 2015-16, and is likely to be further pulled down to 3.8 percent by June 2017. It speaks volumes about the efficacy of the macro-economic and structural reforms introduced by the government. Expansion in the tax-net, pulling down inflation to a single digit, increase in credit to private and agriculture sector, gradual enhancement in development funding, increased foreign remittances, and foreign exchange reserves touching $24 billion are all credible indicators of the health of the economy. These factors coupled with the fiscal discipline have not only helped in bringing down the budget deficit but also contributed to reducing the debt to GDP ratio from 64 percent of GDP in 2012-13 to 63 percent at the end of 2014-15, besides managing the debt issue remarkably well. It is further aimed to be reduced to 60 percent during the next three years. It is pertinent to mention here that the previous government, during its five-year tenure, contracted a net debt of Rs 8,515 billion, while the present government has raised the net debt of Rs 4,189 billion. The reason for low level of borrowing by the government was that it kept the fiscal deficit under control trough enforcement of fiscal discipline. The present government reportedly repaid $10 billion of external debt till end of December 2015, which mainly related to borrowings by the previous government. It is encouraging to note that despite this heavy repayment, the foreign exchange reserves have reached a phenomenal figure of $21 billion. The PML-N government, in view of the precarious economic situation, perforce had to resort to borrowing from internal and external sources including the IMF, as well as raising money from international financial market through issuance of Euro bonds. The country, undoubtedly, was on the verge of default in regard to loans taken from the IMF by the previous government; the PML-N government had no choice but to immediately seek the Extended Fund Facility of $6.6 billion from it to avoid the emerging disaster. It also needed money for its developmental needs and other unavoidable expenditures. Persistent budget deficit also necessitated internal and external borrowing. However, the borrowings have been well managed as compared to the loans taken by the previous government, which had tremendously increased the debt liabilities of the present government such as debt servicing. Borrowing from internal and external resources is an indispensable imperative for economies like Pakistan. But what is important is that the money borrowed should be gainfully invested so that repayments could be made from the resources that are generated by those investments, and the residual money can also be diverted to productive channels. Borrowing for the sake of repaying debts can put the economy under further strain. The economy of Pakistan is well on its way to a sustained development, and in view of the future projections it can be safely inferred that Pakistan will be in a comfortable position in the future to pay back these loans as well as to reduce its dependence on borrowed money. The fact that Pakistan has said good-bye to the IMF after fulfilling its obligation under the current arrangement leaves no doubt in regard to a solid management of the public debt and the revival of the economy. These achievements coming in the backdrop of enormous resources diverted to the implementation of the Operation Zarb-e-Azb, and political turmoil orchestrated by a political entity for the last two and half years is a commendable effort by all standards. The China-Pakistan Economic Corridor has also opened up infinite economic possibilities for Pakistan as well as the entire region. Development of infrastructure under this mega-economic initiative will change the economic profile of Pakistan on a perennial basis, and convert it into a hub of economic activity for South Asian and Central Asian region, besides creating a win-win situation for both Pakistan and its all-weather friend China, which has a great stake in the completion of CPEC to realise the dream of its leadership to revive the old silk route under the One Belt, One Road vision given by Chinese President Xi Jin Ping. The energy projects under CPEC, already on the roll and likely to be completed by the end of 2018, will not only help to tide over the current energy crisis, but would also produce enough energy for future industrial growth in Pakistan. The inference one can safely draw from all the foregoing facts is that Pakistan due to the economic stability achieved so far, and government’s decision to become part of CPEC is well poised to tread the path of sustained economic development. The writer is a retired diplomat, a freelance columnist and a member of the visiting faculty of the Riphah Institute of Media Sciences, Riphah International University, Islamabad. He can be reached at ashpak10@gmail.com