This study assesses Pakistan’s fiscal stimulus response to the COVID-19 pandemic, evaluating the degree to which it has managed to support a recovery, which is inclusive, green and forward-looking. In order to align recovery from COVID 19 to SDGs agenda of the country, it is crucial for Pakistan to; expand social protection, mainstream gender in all approaches and measures, roll-out a mass COVID-19 vaccination campaign, shift to green transport, cut fossil fuel subsidies and achieve an inclusive digital transformation. The study identifies the estimated costs and outline financing options for these recommendations. Finally, the study simulates macroeconomic, social and environmental impacts of investment in people, green energy and digital infrastructure on key macroeconomic indicators of the country which include public debt, GDP growth, (un)employment, poverty and CO2 emissions. Findings from these simulations, using the ESCAP’s Macroeconomic Model, support a strong economic and environment case for investments recommended in this study.
Keywords: Building Back Better, Fiscal Stimulus, Inclusive, Green, Forward-Looking, Digital Transformation, COVID-19 Recovery, SDGs, Fiscal Space, Macroeconomic Model
JEL classification: C82, E00, E60, O23, Q01