With growing competition, it is expected that banks will need to tighten their spreads and offer better returns to depositors, while launching efforts to reduce the administrative costs to maintain their profitability. IV. Conclusion  Effective economic management and liberalization together have helped Pakistan achieve a fair degree of economic stability, while setting the stage for economic restructuring and industrial development.
However, preliminary results for FY06 outcome do highlight some short-term risks and vulnerabilities. The fiscal deficit is expected to exceed target in FY06, because of the unanticipated earthquake spending and continued stagnating of the tax/GDP ratio, despite enhanced tax collection.