KARACHI – Federal Minister for Finance Muhammad Aurangzeb warned that climate change is a “battle for survival,” stressing that the government cannot tackle the challenge alone and needs active support from the private sector.
The finance minister said Pakistan is facing two major threats — rapid population growth and climate change. He said that a framework has been discussed with the World Bank consisting of six dimensions, two of which are linked to climate change, and called for private sector participation to strengthen the country’s resilience.
He expressed these words at a workshop organised by Pakistan Banks’ Association at LGH on Monday.
Aurangzeb said the Pakistan Stock Exchange was performing strongly and breaking previous records, while three global rating agencies and Gallup surveys had issued positive assessments of Pakistan’s economy. He added that reforms were under way, including tariff reforms, customs and regulatory duty adjustments over the next four to five years, which would enhance Pakistan’s export potential.
Muhammad Aurangzeb announced that from the next fiscal year, the Federal Board of Revenue’s budget would be formulated by the Tax Policy Office, adding that FBR would have no role in preparing the budget. “It is the private sector that must lead the country, while the government’s job is only to provide a conducive business environment,” he remarked.
He further said progress had been made in recent months on tariff policy, electric vehicles, and digital policy, while former finance minister Haroon Akhtar was working on an industrial policy. He urged a shift from short-term thinking to long-term prosperity, highlighting the need for bankable investment projects to be jointly undertaken by the government and private sector.
Aurangzeb also underscored the government’s commitment to a cashless economy, with Prime Minister Shehbaz Sharif personally supervising the initiative. He said capital markets must be involved alongside banks to promote working capital and that Pakistan’s debt capital market should be shifted to a stock exchange-based mechanism.
On the energy sector, the finance minister said the circular debt in the power sector was declining and the government was moving ahead with the privatisation of three distribution companies. Work was also under way to address gas sector liabilities. He clarified that the government had no direct policy on interest rates, which fell under the jurisdiction of the State Bank of Pakistan, and that the exchange rate would be determined by market dynamics.
Aurangzeb praised Karachi Mayor Mustafa Kamal’s role in population management and emphasised women’s economic participation as a crucial step to reducing poverty. He confirmed that discussions had been held with the World Bank for funding in this area, and said the International Monetary Fund’s (IMF) review mission would soon arrive in Pakistan under the ongoing 37-month programme. He expressed optimism that Pakistan would achieve developed economy status by 2047.
Later, speaking to the media, the finance minister said Pakistan’s anti-money laundering laws were “gold-standard,” enabling the country’s exit from the FATF grey list. “Because of these laws, Pakistan is out of the grey list and will remain out,” he asserted.
He added that he had spoken with the Khyber Pakhtunkhwa finance minister regarding damages from recent rains in the province, noting that the immediate priority was relief and rehabilitation, while damage estimates would be assessed later.
SBP governor and SECP chairman highlight economic reforms
Earlier, State Bank of Pakistan Governor Jameel Ahmad told the workshop that the country was moving towards economic stability and growth. He pointed out that the low domestic savings rate of 7.4 percent limited investment and increased reliance on external borrowing, which in turn affected inflation and the balance of payments.
Meanwhile, Securities and Exchange Commission of Pakistan (SECP) Chairman Akif Saeed said the government was focused on promoting industrialisation. He noted that banks accounted for 25 percent of capitalisation and 34 percent of the index on the Pakistan Stock Exchange, but the number of brokerage houses was very limited. He added that 88 percent of asset management companies were engaged in fixed income, and emphasised SECP’s focus on digitisation, consultation, and measures to boost IPOs and investment volumes.
