Pakistan stays economically stable despite Middle East crisis: FinMin Aurangzeb

Pakistan managed the crisis with relative stability, adding that Eurobond repayment passed smoothly, Muhammad Aurangzeb

Islamabad: Finance Minister Muhammad Aurangzeb stated that Pakistan handled the situation effectively despite the ongoing crisis in the Middle East, describing it as a significant global supply shock.

Speaking at a panel discussion on Pakistan’s economy at Harvard University, he said the country maintained continuity in energy supply and shifted from initial subsidies to full price transfers with targeted support.

He noted that Pakistan managed the crisis with relative stability, adding that Eurobond repayment passed smoothly, reflecting confidence in external payments.

He also highlighted a record rise in transit traffic at Karachi Port and historic remittances through the Roshan Digital Account in March, though he emphasized that exports must be prioritized over remittances for long-term sustainability.

Aurangzeb stressed that the main challenge lies in implementing reforms, including improving the tax system and increasing the tax-to-GDP ratio.

He said digitization and automation in the FBR are in progress, while industrial subsidies should be phased out to promote competitiveness.

He added that tariff reforms and integration into global markets are being pursued. Pakistan’s solar energy capacity has reached 8,000 megawatts, with plans for further renewable expansion.

Agricultural income tax laws have been finalized across all provinces, and 28 state-owned enterprises have been referred to the Privatization Commission.

He also identified population growth and climate change as key challenges, noting that improving the business environment remains a top government priority.