Tag: Pakistan economy

In response to soaring global oil prices triggered by regional tensions, Prime Minister Shehbaz Sharif has launched a nationwide "war austerity plan." The initiative targets massive fuel and fiscal savings by shifting the country to a four-day work week and a 50% work-from-home model for both public and private sectors (excluding banks and essential services). Additional measures include a 50% cut in government fuel quotas, grounding 60% of the official fleet, and significant salary deductions for cabinet members, lawmakers, and high-ranking officials. To further reduce overhead, the government has banned hotel-based events and foreign travel, while closing schools from March 10 to 31 in favor of online learning. These combined efforts are projected to save the national exchequer over PKR 26 billion.

The Pakistani government has announced a massive Rs55 per litre increase for both petrol and diesel, effective from midnight on Friday. This record hike brings petrol to Rs321.17 and diesel to Rs335.86 per litre, a decision driven by skyrocketing global oil prices following the escalation of conflict between Iran, the US, and Israel. Government officials, including Finance Minister Muhammad Aurangzeb and Deputy PM Ishaq Dar, noted that the regional instability has caused Brent crude to surge above $90 a barrel. In response to the crisis, Prime Minister Shehbaz Sharif has ordered an immediate nationwide crackdown on fuel hoarding and the cancellation of licenses for stations creating artificial shortages.

The escalating war in the Middle East following US and Israeli strikes on Iran has effectively paralyzed Pakistan’s external trade. With over 150 flights cancelled and major shipping routes including the vital Strait of Hormuz suspended or restricted, the supply of oil and LNG to Pakistan faces a critical threat. The UAE and Saudi Arabia, two of Pakistan's largest trading partners, are now in a state of high tension, putting the government’s $60 billion export target at serious risk. Beyond trade, the humanitarian and financial toll is mounting. Thousands of Pakistanis, including Umrah pilgrims, remain stranded, while the country’s stock market has already plunged 9% in a single morning. Remittance inflows, the backbone of Pakistan’s foreign reserves, are expected to drop sharply during the month of Ramazan, as the regional volatility creates massive uncertainty for millions of Pakistani expatriates.

SBP Governor Jameel Ahmad prioritizes economic stability over aggressive rate cuts, citing Pakistan's post-crisis phase with 5-7% inflation, current account surplus, and recovering reserves. Focus shifts to sustainable growth via development finance, as sharp easing risks inflation rebound; exporter aids include tariff cuts and Export Finance tweaks amid $7B IMF EFF ending 2027.

The FBR has officially increased property valuations in Islamabad by 15% to 75% via a new notification (SRO.163), though DHA areas remain notably excluded. The updated framework sets building values at Rs3,000 per sq. ft. for structures up to five years old and Rs1,500 for older ones. While rural areas will still follow DC rates, the FBR clarified that the higher value will always apply in case of a conflict. This revised policy follows a brief suspension of previous, more aggressive rates to accommodate feedback from real estate stakeholders.

Uplift AI is more than just a software company; it is a digital inclusion project. By focusing on "voice-first" solutions built entirely in-house, the startup is empowering a massive, previously excluded segment of the population to participate in the digital economy.

In a record-breaking move for Pakistan’s financial landscape, United Bank Limited (UBL) and Meezan Bank have spearheaded a Rs133 billion syndicated Islamic financing facility, the largest of its kind in the country’s private sector. This landmark deal facilitated the Engro Group’s acquisition of Deodar (Private) Limited from Pakistan Mobile Communications Limited (Jazz), a strategic transition that consolidates over 10,617 cellular towers and establishes Deodar as Pakistan's premier independent tower company. By providing essential Shariah-compliant capital for both the acquisition and ongoing operational needs, this transaction underscores the banking sector's capacity to support massive infrastructure projects that serve as the backbone for Pakistan's long-term economic and digital growth.

In response to an IMF diagnostic report highlighting institutional weaknesses, the federal government has formed a 15-member high-level committee to overhaul Pakistan’s economic governance. Led by the Finance Minister, the panel is tasked with strengthening accountability and institutional capacity, a move the IMF estimates could boost GDP by 5% to 6.5% over the medium term. The committee includes top officials from the State Bank, SECP, and various ministries, and will submit progress reports to the Prime Minister on a quarterly basis.

Pakistan's State Bank of Pakistan (SBP) reserves rose by $13 million to $15.915 billion as of December 26, 2025, contributing to total liquid reserves of $21.012 billion despite a slight drop in commercial banks' holdings. This provides about 3.2 months of import cover amid ongoing debt pressures. The improvement marks a strong recovery from 2023 lows below $3 billion, aided by IMF support and bilateral aid, while domestic gold prices fell Rs2,400 per tola to Rs454,562.