On Cholistan Canal construction, government agrees to build consensus I Government invites fresh bids for PIA’s sale
In Focus
Pahalgam Terror Attack: Islamabad’s response to India’s measures
What happened?
On 24 April, PM Sharif presided over the “emergency session” of National Security Committee to mull over Islamabad’s responses to New Delhi’s measures against Pakistan after the recent terrorist attack in Pahalgam. The Foreign Office called out the charge d affaires of India and was given a “demarche.” Islamabad has ordered New Delhi’s “defence, air and naval attachés” to leave Pakistan and demanded India to reduce its diplomatic presence to 30. All Indian nationals with the exception of Sikh worshippers have been asked to return to India in the next 48 hours.
The committee has decided to close its airspace for Indian flights, discontinue trade. Pakistan has cautioned New Delhi that attempts to alter the flow of Indus River would be seen as “act of war.” It also hinted of a possibility that it could cease all the “bilateral agreements” with India which also includes the Shimla agreement 1972. The committee claimed that Islamabad has the capacity to effectively respond to any threat to its “sovereignty and territorial integrity” and expressed its backing for the people of Jammu and Kashmir and advocated for their “right to self-determination.” The committee demanded that New Delhi must accept that it was because of their failure to ensure security in Jammu and Kashmir that led to the attack in Pahalgam. As per the committee, India’s measures against Pakistan after the attack cannot undermine former’s alleged involvement in facilitating terrorism across Pakistan. The committee called out New Delhi for unilaterally walking out of the Indus Water Treaty. The NSC pointed out that treaty does not have any clause which could justify New Delhi’s actions. The committee claims India cannot suspend the Indus Water Treaty as it is an “international binding” accord.
What were the responses from political parties of Pakistan?
PPP leader Sharjeel Memon hinted that the attack in Pahalgam could be a “false flag operation.” PTI’s Haleem Adil Sheikh alleged that the present Indian government is “global sponsor of terrorism.” He blamed the Indian government for allegedly involving itself in “water terrorism.” Former PM Shahid Khaqan Abbasi urged the federal government to not commit the same “mistakes” as were committed by the Khan led government after article 370 was repealed. The Prime Minister of “Azad Jammu and Kashmir,” Anwarul Chaudhry warned that New Delhi should not engage in any “misadventure” against Pakistan. Further, he alleged that New Delhi could engage in actions that would impact the stability of “Azad Jammu and Kashmir. CM of Gilgit Baltistan, Gulbar Khan claimed that the “entire” country is on the same page and it would give a strong response to India’s measures against Pakistan. Kazim Mesum who is the leader of opposition in the Gilgit Baltistan Assembly drew parallels between India and Israel, alleging both the countries were “expansionist, coercive and anti-Muslim. Further, he alleged that PM Modi, after repealing article 370, now wants to take over Gilgit Baltistan.
How did the civil society respond to Islamabad’s response?
On 25 April, an editorial in The News International titled “India’s dangerous game” alleged that there is a trend of New Delhi calling out Pakistan as the culprit for any attack or assault that takes place in its territory, even when the former cannot substantiate its claim with conclusive evidence. It terms India’s measures as “rash, disproportionate and downright dangerous.” The editorial terms Islamabad’s reaction to India’s measures as “mature, measured” and in interest of “regional stability.”
On 25 April, an opinion in The News International titled “India can’t stop Pakistan’s water,” discussed the possibility of India breaching Indus Water Treaty. Ali Tahir claims that New Delhi’s decision to walk out of Indus Water Treaty is only to signify that it took a hard stance against Pakistan after the attack in front of its domestic population.
As per Dawn, US and World Bank might intervene for saving the Indus Water Treaty. Hassan Abbas at the National Defence University, Washington also pointed to the possibility of US President Donald Trump wanting to act as a mediator to bring down tensions between the countries.
Muhammad Anis & Shakeel Anjum, “Defence minister warns if Pakistanis attacked, Indian citizens won’t remain safe either: Pakistan hits back at India as war clouds loom over subcontinent,” The News International, 25 April 2025
“Assault on rivers will be ‘act of war,’” Dawn, 25 April 2025
ftikhar A. Khan, “FO summons Indian envoy, scales down diplomatic ties,” Dawn, 25 April 2025
Ali Tahir, “India can’t stop Pakistan’s water,” The News International, 25 April 2025
“India’s dangerous game,” The News International, 25 April 2025
“India water move threatens Pakistan farms: report,” The News International, 25 April 2025
Khalid Hasnain & Anwar Iqbal, “‘US, World Bank may try to save Indus treaty’,” Dawn, 25 April 2025
Imran Ayub, “India’s hostile actions denounced across political spectrum,” Dawn, 25 April 2025
In Brief
POLITICS & GOVERNANCE
On Cholistan Canal construction, government agrees to build consensus
On 24 April, the Pakistan Muslim League (N) (PML-N) and the Pakistan People’s Party (PPP) decided to halt construction of the Cholistan canal project under the Green Pakistan Initiative. Following a meeting between the two, Prime Minister Shehbaz Sharif said at a joint presser: “We unanimously decided that no canal will be constructed till the decision of the Council of Common Interests (CII).”
The PM acknowledged the federation’s obligation to settle inter-provincial disputes in the larger interest of Pakistan, as it did with the shelved Kalabagh Dam project after considering the views of all provinces. Similarly, he agreed that the six-canal issue must be resolved via mutual understanding. He assured no further activity on the canal construction until the CCI convenesa meeting on 2 May to establish consensus on a long-term agricultural policy and water management infrastructure across the country. Additionally, a notification from the Prime Minister’s Office maintained that no new canals will be constructed until a mutual understanding is reached by the CCI. Speaking alongside the PM, PPP Chairman Bilawal Bhutto welcomed the federation’s decision, while expressing interest in working with the PML-N. This statement dispels circulating speculations regarding the PPP withdrawing from the ruling coalition. Separately, Sindh Chief Minister Murad Ali Shah hailed the new development and urged demonstrators to call off their protests. (Syed Irfan Raza, “Canals project ‘placed on back burner’ until consensus,” Dawn, 25 April 2025)
ECONOMY
Government invites fresh bids for PIA’s sale
On 24 April, the government invited new bids for the Pakistan International Airlines after months of stalled attempts to sell the national air carrier. In the bid, the government has offered 51 to 100 per cent share capital along with management control. Investors can submit their expression of interest by June. This will follow a bidding process between October and December. Speaking to media persons, PM’s Adviser on Privatization, Muhammad Ali, and Privatization Secretary, Usman Akhtar Bajwa, relayed government incentives to make its offer more attractive. An exemption of 18 per cent General Sales Tax will be applied on the purchase or lease of the aircraft, more support will be given to improve the net equity position of the PIA’s balance sheet in terms of indemnification or transfer of liabilities and protection from certain taxes and litigation claims. Besides, the government has restructured the PIA by transferring legacy debt and non-aviation assets to a holding company. (Amin Ahmed, “Fresh bids sought for second push to sell PIA,” Dawn, 25 April 2025)
18 per cent growth in the financial sector: SBP review
On 24 April, the State Bank of Pakistan’s Financial Stability Review for the calendar year of 2024 highlighted potential risks to the domestic economy in light of global economic scenario. It alluded to Pakistan’s vulnerability to the rise of protectionist measures that significantly impact global financial conditions and economic growth. On the domestic front, the report attributed domestic economic stability to financial institutions’ performance and risk assessment. The financial sector grew to 17.8 per cent in 2024, indicating favorable economic indicators, and the balance sheets of banks grew by 15.8 per cent. Even macroeconomic conditions projected considerable improvement during the year as inflation subsided. It resulted in monetary easing, foreign exchange stability, pick-up in economic activity, and a better external account balance. (“Financial sector grows by 18 per cent,” Dawn, 25 April 2025)
Potential tariff cuts from revised power plant contracts under hybrid model
On 24 April, the government announced savings worth PKR 1.567 trillion through revised contracts with four national power plants. Speaking at a public hearing, the Central Power Purchasing Agency revealed that the savings amounted to PKR 21.65 billion in the current year. However, the government is yet to explain how it will cope with its revenue losses. The revised contracts involve a shift from the ‘take or pay’ model to a ‘hybrid take and pay’ model, a reduction in return rate, and a discontinuation of a limit on dollar indexation at PKR 168. Furthermore, the National Electric Power Regulatory Authority announced the discontinuation of dollar-based indexation for these plants. Instead, a rupee-based indexation will be adopted for the rest of the plant life to “curb foreign exchange exposure and reduce tariff volatility for consumers.” The savings are largely derived from reduced capacity charges and operation and maintenance costs in plants located in Balloki, Haveli Bahadurshah, Guddu, and Nandipur. In this regard, the revised terms will help reduce the electricity costs by 25 to 32 paise, making the 30-year average tariffs range between PKR 9 to PKR 12 per unit. (Khaleeq Kiani, “Tariff cuts planned for power plants under hybrid model,” Dawn, 25 April 2025)
SECURITY
Three killed in IED explosion in Kalat
On 24 April, three people, including a Jamia Ulema-i-Islam (F) (JUI-F) leader, were killed in a roadside explosion while five others sustained injuries in Kapootu, Kalat. According to Levies, an improvised explosive device detonated when it came in contact with a pickup vehicle with eight passengers onboard. An official from the Kalat administration claimed that the IED may have been planted to attack security personnel. No group has claimed responsibility for the attack so far. (“JUI-F leader among three killed in Kalat blast,” Dawn, 25 April 2025)
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