Karachi (December 19, 2025) Mian Zahid Hussain, President Pakistan Businessmen and Intellectuals Forum & All Karachi Industrial Alliance, Chairman National Business Group Pakistan, Chairman Policy Advisory Board FPCCI, and Former Provincial Minister Information Technology, has expressed a mix of cautious optimism and strategic concern regarding Pakistan’s economic performance during the first five months of the fiscal year 2025-26. Reviewing the data, he noted that while macroeconomic stability is taking root, structural vulnerabilities and climate-induced disruptions remain significant hurdles to long-term prosperity.
The July – November period witnessed a remarkable cooling of inflationary pressures while inflation eased back to 6.1% in November, this disinflationary trend allowed the State Bank to continue its monetary easing, culminating in a 50-basis point cut to 10.5% in December. However it should have to be brought down to a single digit as “Lower borrowing costs are essential for industrial revival,” Mian Zahid Hussain remarked, “we must ensure this liquidity reaches the Small and Medium Enterprise (SME) sector.”
Mian Zahid Hussain stated that Pakistan’s external account showed a significant turnaround, recording a current account surplus of $100 million in November 2025, reversing the deficit from the previous month. This was largely driven by robust worker remittances, which reached $16.1 billion during Jul-Nov 2025, marking a 9.3% growth.
However, Mian Zahid Hussain highlighted a concerning trend: Foreign Direct Investment (FDI) dropped by 25% to approximately $927 million in the Jul-Nov period. “The reliance on remittances to mask a stagnant export base is a high-risk strategy,” he cautioned. “We need a decisive move toward the structural reform and privatization plan to cut energy prices to make our exports competitive.”
The Pakistan Stock Exchange (PSX) emerged as a global outlier, with the KSE-100 index surging past the 172,000 mark by mid-December, up from 125,627 at the start of the fiscal year. This bull run reflects investor confidence following the successful completion of the IMF’s Second Review under the Extended Fund Facility (EFF), which triggered a $1.1 billion disbursement, he noted.
On the fiscal side, the FBR’s tax collection, while missing the target, grew by 12% to Rs. 3.8 trillion during Jul-Oct. While commendable, Mian Zahid Hussain noted that the burden continues to fall on existing taxpayers, emphasizing the urgent need to broaden the tax net to include untapped sectors.
The World Bank and IMF have projected GDP growth for FY26 at 3.6%. However, flood-related damage to the agriculture sector—particularly a projected decline in Punjab’s crop output—poses a threat to food security and industrial raw material supply.
Mian Zahid Hussain concluded by urging the government to capitalize on this hard-won stability. “The transition from a ‘stabilization mode’ to a ‘growth mode’ requires more than just high interest rates and import curbs. We need energy price rationalization and a focus on the ‘Resilience and Sustainability Facility’ to safeguard our economy against climate change.”
