Federal Minister for Planning and Development Ahsan Iqbal declared that Pakistanis pay among the world’s lowest taxes, emphasizing that robust tax revenues, exports, and foreign investment form the backbone of a strong economy. Speaking at a ceremony in Karachi, he outlined Pakistan’s journey from near economic collapse to emerging stability while identifying ongoing challenges.

Iqbal recalled the dire situation in April 2022, when Pakistan faced an internal default and fears of an external one loomed. “The nation supported tough decisions, and now international institutions recognize our macroeconomic stability,” he said. He highlighted a significant drop in interest rates from 22% to 11% and noted that global credit rating agencies, including Fitch and Moody’s, have upgraded Pakistan’s economic outlook. “We stand at the cusp of a new economic takeoff, after three prior failures,” he added, referencing past by-elections that exposed government shortcomings despite his party’s popularity.

Despite progress, Iqbal acknowledged persistent hurdles. Pakistan continues to borrow for non-development expenses, with a budget deficit exceeding 6%. Exports lag behind global competitors, and attracting foreign investment remains fiercely competitive. He stressed the need to double the tax-to-GDP ratio from 9.5% to 18-20% to fund infrastructure and reduce reliance on loans.

The minister explained that the National Finance Commission (NFC) Award allocates 60% of revenues to provinces, leaving 40% for federal needs, previously consumed by debt repayments. “Through reforms, we’ve created Rs. 2,800 billion in fiscal space, allowing us to fully finance Rs. 2,500 billion in defense spending without additional borrowing,” he said, showcasing a key achievement.