Dr. Ashok Behuria, Senior Research Fellow, MP-IDSA, spoke on “Developments in Pakistan 2024: An Analysis” at the Monday Morning Meeting held on 13 January 2025. The session was moderated by Dr. Smruti S Pattanaik, Research Fellow, MP-IDSA.  Ambassador Sujan R Chinoy, the Director General of MP-IDSA and the scholars of the Institute attended the meeting.

Executive Summary

In 2024, Pakistan experienced economic recovery alongside growing political and security challenges. Despite concerns over a potential default, the economy showed positive signs of recovery, bolstered by foreign financial assistance and strict economic policies. However, the country remained heavily reliant on external support. The security situation deteriorated significantly, with a rise in terrorist attacks, particularly from the Tehreek-e-Taliban (TTP) and separatist groups. Politically, tensions were high following disputed elections, with Imran Khan’s influence persisting despite legal challenges. Relations with neighbouring countries, especially Afghanistan and India, remained strained. However, long-term stability depends on economic reforms, political reconciliation, and improved security measures.

Detailed Report

Dr. Ashok Behuria began his presentation by providing a brief overview of developments in Pakistan in 2024. While discussing the economic landscape of Pakistan, he said that despite initial concerns over a potential default, the economy showed signs of recovery due to external financial assistance and stringent economic policies. He noted that foreign exchange reserves, which had fallen drastically in early 2023, rebounded to approximately USD16 billion by December 2024. Additionally, inflation saw a sharp decline from 38 percent in the previous year to 4.9 percent, attributed to fiscal discipline and monetary policy adjustments. He also mentioned that the State Bank of Pakistan’s decision to reduce the policy rate played a crucial role in stimulating economic activity.

Discussing trade and remittances, Dr. Behuria highlighted that the current account registered a surplus of USD729 million in November 2024, the highest in two decades. He pointed out that this improvement resulted from higher exports, controlled imports, and an 11 percent increase in remittances, which reached USD30.2 billion in the fiscal year 2024. While acknowledging this progress, he observed that Pakistan remained heavily dependent on external financing, with the International Monetary Fund (IMF), China, Saudi Arabia, and the UAE playing a pivotal role in stabilising the economy.

Dr. Behuria then addressed military expenditure, highlighting its significant share of the national budget. He explained that currency depreciation had contributed to increased defence spending. While noting a relative decline over recent years, he emphasised that defence remained a major government priority.

Shifting focus to internal security, Dr. Behuria observed that Pakistan experienced a significant escalation in terrorist activity in 2024. He stated that a total of 521 terrorist attacks took place, marking a 70 percent increase from the previous year. These incidents resulted in 852 fatalities and 1,092 injuries, with Khyber Pakhtunkhwa and Balochistan being the most affected regions. He explained that security forces responded with intensified counterterrorism operations.

Dr. Behuria also highlighted that the Tehreek-e-Taliban Pakistan (TTP) had emerged as a critical challenge for the security establishment. He observed that targeted violence extended beyond security personnel to include political leaders, civilians, and infrastructure. In addition, he noted an increase in sectarian violence, particularly in Kurram, where clashes intensified. He remarked that the resurgence of nationalist insurgent groups, particularly Baloch rebels, posed an additional security challenge.

Turning to the political situation, Dr. Behuria stated that instability had become a persistent feature of Pakistan’s governance landscape. He noted that tensions between political institutions escalated following the February 2024 elections, which were marked by allegations of manipulation. He observed that the military’s image suffered considerably due to its perceived role in political engineering, and the country remained divided along pro- and anti-Imran Khan lines. He added that the judiciary-executive struggle was a dominant feature of the year, with heightened tensions over judicial independence.

Discussing the political fate of the former Prime Minister Imran Khan, Dr. Behuria emphasised that he had remained in prison since May 2023, facing multiple legal challenges. He stated that despite these setbacks, Imran Khan remained a very potent force, with 18 million people voting for him in the 2024 elections. He observed that the dialogue between the Pakistan Tehreek-e-Insaf (PTI) and the government had opened up possibilities for political reconciliation, though uncertainties persisted.

Assessing Pakistan’s future trajectory, Dr. Behuria noted that despite improvements in economic indicators, the country remained reliant on foreign assistance, particularly from China, Saudi Arabia, the UAE, and the United States. He pointed out that unresolved economic challenges, including high external debt and inflationary pressures, could limit long-term stability. He further warned that security risks would continue to pose significant challenges, particularly in the wake of the TTP’s resurgence and heightened sectarian violence.

Discussing foreign relations, Dr. Behuria noted that Pakistan’s relationship with its neighbours remained problematic, with deteriorating ties with Afghanistan and potential missteps in its diplomatic engagement with India. He assessed that Pakistan’s reliance on militant proxies could continue to complicate its geopolitical standing. At the same time, he observed that balancing relations with global powers such as China and the United States was crucial for Pakistan’s economic stability and security. In conclusion, he assessed that while the government had taken steps to stabilise the economy, long-term growth would require structural reforms. He emphasised that addressing political polarisation and enhancing security measures were critical to ensuring stability in the country.

Questions and Comments

Ambassador Sujan R. Chinoy, DG, MP-IDSA complimented Dr. Behuria for his thorough analysis and presentation. He raised questions about the defence budget, specifically its impact on Pakistan’s broader economic strategy, considering fluctuations in GDP and tax revenues. He also questioned the claim that economic downturns lead to increased conflict with India, suggesting the need for deeper historical analysis. He emphasised the importance of focusing diplomatic efforts on engaging with the Taliban, rather than solely addressing tensions with Pakistan. Finally, he also highlighted the significance of Pakistan’s strategic partnerships in shaping its foreign policy.

Dr. Smruti S. Pattanaik, the moderator, inquired about the impact of the worsening internal security situation on the defence budget, specifically whether any additional allocations had been made. She also asked about the implications of the growing role of the Pakistan Army both internally and externally on the country’s security. Finally, she sought clarification about how the reduction of forces on the Pakistan-India border contributes to the normalisation of relations.

Additionally, the scholars raised important points about the political and security situation in Pakistan, including the influence of the military, its relations with neighbouring countries, internal stability and potential upsurge in terrorist activities.

Dr. Ashok Behuria responded to the comments made by the Director General and the questions raised by MP-IDSA scholars.

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Report prepared by Ms. Sneha M., Research Analyst, South Asia Centre, MP-IDSA.