Finance Minister Muhammad Aurangzeb reaffirmed the government’s commitment to economic reforms on Monday, emphasizing the urgent need to restructure state-owned enterprises (SOEs) to address mounting financial losses.
Speaking at the "Pakistan Banking Summit 2025" in Karachi, Aurangzeb stressed that SOEs currently face Rs1 trillion in losses, which calls for privatization and extensive reforms.
"Reforming SOEs and moving forward with privatization is the right thing to do for the country at this point," the finance minister remarked. He acknowledged that these measures were necessary to stabilize Pakistan’s economy, which continues to grapple with significant fiscal challenges.
Aurangzeb further highlighted that the government is focused on achieving sustainable and inclusive growth, especially by tackling external account vulnerabilities. “We cannot continue with this level of external account vulnerability,” he stated, adding that the country aims to expand beyond its traditional sectors—textiles, IT, and agriculture—by promoting export-led growth. He identified minerals as a potential game changer, predicting that the sector will play a crucial role in economic growth by 2028.
On the tax front, the finance minister noted that while certain sectors contribute significantly to GDP, their tax contributions are disproportionately low. “Some sectors contribute 19-20% to GDP, but their contribution to the exchequer is just 1%, which is not sustainable,” he remarked. Aurangzeb outlined the government's plans to broaden the tax base and plug existing tax leakages to ease the burden on other sectors.
Regarding the International Monetary Fund (IMF), Aurangzeb shared that an IMF mission had arrived in Pakistan to discuss the Climate Resiliency Fund. Another IMF delegation is expected in early March for formal discussions on Pakistan's performance under the Extended Fund Facility (EFF).
On cryptocurrency regulations, the finance minister stated that the central bank is handling this matter, and he encouraged a balanced, open-minded approach to the emerging sector.
