ISLAMABAD: Emphasising that continued economic reform is essential to reach a high growth trajectory, the Asian Development Bank (ADB) has asked Pakistan to address key constraints on growth since regulation remains burdensome, requiring more reforms to provide an enabling environment that promotes business and encourages investment.

The Asian Development Outlook 2017 report released on Thursday, projects that gross domestic product (GDP) growth is expected to edge up to 5.2 per cent in FY17, and 5.5pc in FY18, underpinned by higher growth in the major industrial economies.

With national elections scheduled for 2018, the budget to be announced this June is likely to prioritise measures to foster economic expansion.

Higher growth in FY18 reflects accelerated infrastructure investment through the China-Pakistan Economic Corridor (CPEC), which is steadily lifting consumer and investor confidence and thereby further catalysing economic activity.

This outlook for Pakistan is supported by better security, macroeconomic stability, and improved economic fundamentals resulting from the continued implementation of government reforms under the three-year IMF programme, which was completed in September 2016, as well as ongoing and planned infrastructure and other investments under CPEC which links Pakistan with China.

The ADB flagship economic publication recommends that the government must continue to address key constraints on growth also to reap the potential benefits of CPEC. Domestic security has improved significantly in recent years, but consolidating these gains will take continued efforts, points out the report.

For Pakistan, CPEC is expected to be a major opportunity to boost growth and development. It is expected to provide many benefits, especially eliminating the power shortages that have held down economic growth in recent years.

Published in Dawn, April 7th, 2017