Fri Apr 25 03:10:00 UTC 2025: ## Pakistan Stock Market Plunges After India’s Retaliation, Economic Concerns Mount

**ISLAMABAD** – Pakistan’s stock market experienced a significant drop on Thursday, April 24th, plummeting nearly 2,000 points following India’s response to a terror attack in Pahalgam. The KSE-100 index fell by 1.81%, adding to recent economic anxieties.

This sharp decline follows a downward revision of Pakistan’s growth forecast to 2.6% by the International Monetary Fund (IMF) earlier this week. While the Pakistani economy has shown signs of improvement since a crisis point last year, these recent events represent a significant setback.

The IMF’s reduced growth projection, primarily attributed to previously imposed (now paused) US tariffs on Pakistani imports, comes despite a recent staff-level agreement securing a $1 billion loan under the Extended Fund Facility (EFF) and a further $1.3 billion under the Resilience and Sustainability Facility. While the IMF praised Pakistan’s progress in restoring macroeconomic stability, concerns remain regarding potential policy slippages and geopolitical risks.

The World Bank also issued a report highlighting continued economic stabilization but also noting slow growth in agriculture and industry, hampered by adverse weather, high input costs, and reduced government spending. Although growth is projected at 2.7% for the current fiscal year, the report underscores challenges in job creation and poverty reduction.

Credit rating agency Fitch, while acknowledging progress in taming inflation, emphasized the need for structural reforms, including tax increases and a reduction in protectionism, to secure continued IMF and other international funding. These reforms have already begun with the recent scrapping of Minimum Support Prices for crops.

The combined impact of the stock market plunge, downgraded growth forecasts, and the need for significant economic restructuring paints a complex picture for Pakistan’s economy. While improvements have been made, the country remains vulnerable to both internal and external pressures.

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