The maintenance of Macroeconomic stability is the prerequisite for sustained development and economic growth. As the stable growth and inflation helps to keep short term and long term interest rates low, hence, vital in reducing the costs of debt-servicing.
Moreover, stable real economy helps to breads stable expectations and this in turn can provide an incentive for the foreign investor as well.The past development strategies of Pakistan have not delivered high sustainable economic growth; rather have only led to boom-bust cycles. The high growth periods in the past have been triggered by conducive international developments and increase in foreign assistance. Once these flows slowed down, so did the momentum of economic growth. This is because the growth has not been supported by an increase in investment and exports. In addition to that Progress in human and social indicators has been disappointing. Poverty levels remain high, job opportunities that meet citizen's aspirations are lacking, and stark income inequalities have appeared in the recent years. Furthermore, Socio-economic tensions have been heightened on account of increasing disparities among the provinces. Within the provinces, significant areas feel deprived of the gains that should have accrued to them from economic growth. This situation demands a fundamental change in the development paradigm so that common people must be at the center of the development process and have ownership in the economic development of the country. This change requires more investment in people, leading to high sustainable growth, reduction in poverty, improvement in income distribution and harmony among regions and provinces.