Photo : APP/Irfan Mahmood
NIAS Area Studies
PAKISTAN READER
Photo : APP/Irfan Mahmood
In Focus
Ruling coalition surpasses two-thirds majority in the National Assembly after SC verdict on reserved seats case
On 2 July, the ruling coalition surpassed a “two-thirds majority” in the National Assembly with 235 members. The opposition parties hold 98 seats. This comes after the Election Commission of Pakistan allocated the reserved seats amongst the three parliamentary parties- PML-N, PPP, and JUI-F, following the Supreme Court’s ruling on the reserved seats case. The Supreme Court’s ruling on the reserved seats case benefited PML-N the most as it was allocated 43 out of a total of 74 seats in provincial and national assemblies. PPP gained 14 seats, whereas JUI-F was allocated 13 seats. One seat each was allocated to PML-Q, MQM-Pakistan, ANP, PTI-Parliamentarians, and Istekham-i-Pakistan Party (IPP). In the National Assembly, a total of 19 seats were allocated. 13 of the 19 seats went to the PML-N, whereas four went to PPP. Two seats in the National Assembly went to JUI-F. Currently, after the allocation of seats, PML-N has 123 members in the National Assembly, PPP has 74, MQM-P has 22, and PML-Q has five. Istekham-i-Pakistan has four members in the National Assembly, whereas Balochistan Awami Party, National Party, and PML-Z have one member each. The four independent National Assembly members are also included in the ruling coalition's strength in the National Assembly.
On 3 July, an editorial in The Express Tribune titled “Political wrangling,” discussed the present dire state of PTI. The editorial highlighted how, after the recent Supreme Court ruling, PTI will not be considered as a “parliamentary party” and it has lost its right to get its share of reserved seats. Further, the editorial pointed out that after the Supreme Court’s order, PTI members who had previously joined the Sunni Ittehad Council (SIC) might now have to witness the “defection clause,” in case they decide to come back to PTI. The editorial further argued that PTI members who joined SIC should have instead joined Majlis Wahdat-e-Muslimeen, as the latter had officially taken part in the national elections
On 3 July, an editorial in The News International titled “Call for sanity,” appreciated the imprisoned leaders of PTI- Yasmin Rashid and Shah Mehmood Qureshi for approaching the government for a dialogue. As per the editorial, the letter written by the jailed PTI leaders signifies a call for “moderation.” The editorial highlighted how the jailed leaders have not compromised on their loyalty towards the PTI; nevertheless, they have conveyed their willingness to hold a “political dialogue” with the government, which signifies a change in the earlier stance taken by the party leadership. The editorial argued that the people who have recently joined PTI are reluctant to question Imran Khan’s stance and have not been able to steer PTI with a “realistic strategy.” The editorial suggested that the government should not see a fractured PTI as an “opportunity” to decimate the PTI. Also, the editorial called on the establishment to play a constructive role by helping PTI and the government to settle their disagreements.
References:
“Govt takes commanding lead after being handed reserved seats,” Dawn, 3 July 2025
“Political wrangling,” The Express Tribune, 3 July 2025
“Call for sanity,” The News International, 3 July 2025
PM Sharif to visit Baku for ECO summit
On 3 July, PM Sharif is set to embark on his visit to Baku, Azerbaijan, to take part in the Economic Cooperation Organization (ECO) summit. The summit will be held between 3 July and 4 July under the banner of “New ECO Vision for a Sustainable and Climate Resilient Future.” The leaders of ECO member countries are expected to deliberate on important issues such as “regional challenges, economic integration, and climate resilience.” In the summit, PM Sharif is anticipated to put forward Pakistan’s stance on “regional and global issues.” Further, it is also anticipated that he would reaffirm Pakistan’s resolve to the “ECO Vision 2025” and push for increasing “intra-regional trade,” improving “connectivity,” and work towards “sustainable development.” Also, PM Sharif would convene separate discussions with ECO heads of state to deliberate on issues of common interest and emphasize on “economic cooperation, climate challenges, and regional peace.”
The erstwhile Regional Cooperation for Development (RCD), formulated in 1964, transitioned into the current ECO in 1985. ECO currently has 10 member countries that belong to South, Central, and West Asia. (“PM Shehbaz to attend ECO summit in Baku from July 3-4,” The Express Tribune, 3 July 2025)
State Bank of Pakistan’s foreign reserves reach USD 14.51 billion in FY25, surpassing the IMF target
On 3 July, The News International reported that Pakistan’s central bank’s foreign exchange reserves increased to USD 14.51 billion by USD 5.12 billion as of June 30, 2025, the end of its fiscal year, exceeding the International Monetary Fund’s target of USD 13.9 billion. The significant increase in reserves can be attributed to the grant of commercial loans of USD 3.10 billion and multilateral loans totaling over USD 500 million. Further, last week, China had rolled over USD 3.4 billion in loans to Pakistan, by rolling over USD 2.1 billion, which has been in Pakistan’s central bank’s reserves for the last three years, and had refinanced an additional USD 1.3 billion commercial loan, which Islamabad had paid back two months ago. Additionally, between June 2024 and March 2025, SBP bought USD 6.8 billion from the interbank market. According to the Director of Research at AKD Securities Limited, Awais Ashraf, “with this level of SBP’s reserves, the country has met the IMF condition set for the central bank reserves above USD 13.9 billion set for June 30, 2025. This is the highest weekly increase.” Ashraf assured that the SBP’s reserves are sufficient to cover 2.5 months of imports, stating that “we expect reserves to surpass USD 17 billion by June 2026 due to strong remittances and a reduction in interest payments.” Overall, the increase in forex reserves reflects improved external account management, higher remittances, and fiscal prudence. It also demonstrates improvement in the country’s current account balance and realisation of planned inflows during the year under the IMF’s guidance. (Erum Zaidi, “Pakistan’s forex reserves with SBP reach $14.51bn in FY25, exceeding IMF’s target,” The News International, 3 July 2025)
In Brief
POLITICS
JUI-F files petition against Mines and Mineral Act 2025 in Balochistan High Court
On 2 July, the JUI-F filed a plea against the earlier passed Mines and Mineral Act 2025 in the Balochistan High Court. As per JUI-F, the act will have a devastating impact on the population of Balochistan. Senator Maluna Wassay of JUI-F argued that the natural reserves in the province belong to the province’s population and that the party would not permit snatching away the “rights of the people.” The Balochistan government highlighted that the plea was filed despite getting support from a few members of the JUI-F for passing the act. On the same, JUI-F has furnished a “show cause notice” to its members who gave their support to the bill. (Saleem Shahid, “Mines law challenged in Balochistan High Court,” Dawn, 3 July 2025)
ECONOMY
Shortfall in achieving development targets
On 3 July, The Express Tribune reported that the federal government spent PKR 905 billion on development schemes under the Public Sector Development Programme (PSDP) in the last fiscal year, which was lower than the allocation in the budget. This will result in a downward revision in the 2.7 per cent economic growth rate that had been projected on the basis of PKR 1.1 trillion in expenses. Federal Minister for Planning and Development, Ahsan Iqbal, stated that, “we had almost touched the PKR 1 trillion spending mark, but due to slow approvals by the Accountant General Pakistan Revenues (AGPR), the spending remained at PKR 905 billion.” It is speculated that one of the reasons behind this shortfall is the Finance Ministry curtailing PSDP spending to achieve quarterly and annual primary surplus targets, aligning with the IMF programme. According to a recently released planning ministry report, a shortfall in actual development spending had impacted projects across various sectors. Further, the government was still adding either new projects or upwardly revising the cost of approved schemes. However, budgetary deviations were not limited to development expenditure utilisation. In the last fiscal year, PKR 69.5 billion was spent by the federal government on provincial projects, which is against the commitments given to the International Monetary Fund (IMF) and the National Fiscal Pact. (Shahbaz Rana, “Govt misses development target,” The Express Tribune, 3 July 2025)
Salaried class paid PKR 545 billion in income tax in FY25, says FBR
On 3 July, The News International reported that the Federal Board of Revenue (FBR) has collected PKR 545 billion in income tax from the salaried class in the outgoing fiscal year. The salaried class in Pakistan has paid “more than double the tax amount” in terms of income tax contribution, compared to the combined contribution of exporters and retailers in the outgoing fiscal year, thereby becoming the highest contributor among all other sectors for direct taxes. The salaried class paid three times the tax compared to that of exporters and eight times more compared to that of retailers. Exporters have paid a tax amount of PKR 180 billion, and retailers have paid PKR 62 billion in the last fiscal year. Additionally, FBR plans to ensure compliance from retailers by implementing penalties for those who are outside the tax net. Under 236G, the FBR imposed a 2 per cent tax on the gross amount of sales of distributors, dealers, and wholesalers other than the sale of fertilizer. Under Section 236H, the tax rate of 2.5 per cent would be charged on the gross amount of sale of those retailers who would prefer to remain outside the tax net, “forcing non-filers to come into the tax net instead of paying tax on their gross amount of sale.” (Mehtab Haider, “Income tax contribution in FY25: Salaried class pays Rs545bn tax, 3 times more than exporters, 8 times more than retailers,” The News International, 3 July 2025)
ENERGY, ENVIRONMENT & WATER
NEPRA issues countrywide uniform tariff for FY25-26
On 3 July, The News International reported that the National Electric Power Regulatory Authority (NEPRA) has approved a reduction of up to PKR 1.16 per unit in electricity base rates for consumers across Pakistan, effective July, to reduce utility costs. This decision comes following the filing of the federal government’s motion for a uniform tariff, on which a public hearing was held by the regulator on 1 July.. The regulator has sent its final decision to the federal government for final notification. This uniform tariff includes the recovery of prior year adjustments (PYA) amounting to PKR 58.68 billion, which will be passed on to consumers over the next 12 months. In addition to residential users, NEPRA has approved a reduction of PKR 1.16 per unit for “general services, street lighting, and agricultural tube-wells.” A tariff cut of PKR 1.15 per unit will also benefit industrial consumers. Additionally, NEPRA clarified that inter-DISCOs tariff rationalisation “will not generate revenue for the federal government, and instead, it remains within the consolidated revenue requirement of all distribution companies (DISCOs) for the year.” (Israr Khan, “Nepra issues countrywide uniform tariff for FY25-26,” The News International, 3 July 2025)
SECURITY
Assistant commissioner, four tehsildars fall victim to the bomb blast in Bajaur, KP
On 3 July, The Express Tribune reported that five people in Bajaur, KP lost their lives due to a bomb explosion. The Nawagai Tehsil Assistant Commissioner Faisal Ismael also fell victim to the attack. The other four victims of the attack were tehsildars. As per KP Police Inspector General Zulfiqar Hameed, the objective of the perpetrators was to attack the vehicle in which the assistant commissioner was traveling. The local officials confirmed that the explosives were planted on a motorbike. Further, it was confirmed that close to seven to ten explosives were utilized. President Zardari and PM Sharif denounced the attack and conveyed their sorrow over the killing of the assistant commissioner and tehsildars. PM Sharif warned that the perpetrators would have to pay a heavy price for attacking innocents. On social media, Tehreek-e-Taliban Pakistan and Islamic State-Khorasan claimed that they were behind the bomb explosion. (Hasbanullah & Javed Aziz Khan, “AC, tehsildar among 5 martyred in Bajaur blast,” The News International, 3 July 2025; Anwarullah Khan, “Assistant commissioner among five martyred in Bajaur blast,” Dawn, 3 July 2025)
EXTERNAL
PM Sharif appreciates Saudi Arabia’s role in truce with India
On 3 July, The Express Tribune reported that in a meeting with the Ambassador of Saudi Arabia in Islamabad, Nawaf bin Saeed Al Malkiy, Prime Minister Shehbaz Sharif appreciated the role played by Saudi Arabia in the ceasefire between Pakistan and India, along with peace in the Middle East. PM Sharif recalled his “cordial telephone conversation” with the Saudi Crown Prince on 24 June to discuss the regional situation. He also communicated his “respectful regards” to the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz Al Saud, and Saudi Crown Prince and Prime Minister, Prince Mohamed bin Salman bin Abdulaziz Al Saud. Further, PM Sharif informed the Saudi ambassador about Pakistan’s Presidency of the UN Security Council for July, stating that it would “count on Saudi Arabia's support” to ensure a productive and successful tenure. The Saudi ambassador expressed gratitude to PM Sharif for “Pakistan's role in peace and stability in the region.” (“PM lauds KSA's role in truce with India,” The Express Tribune, 3 July 2025)
Chief of the Air Staff visits US to enhance defence ties
On 3 July, The Express Tribune reported that Chief of the Air Staff, Air Chief Marshal Zaheer Ahmed Baber Sidhu, paid an official visit to the United States to improve bilateral defence cooperation and promote mutual interests. This marks the first visit by a serving Pakistan Air Force chief in over a decade. During the visit, the Chief of the Air Staff held a series of meetings with senior U.S. military and political leadership. At the Pentagon, he met General David W. Allvin, Chief of Staff of the United States Air Force, and discussed “advancing bilateral military cooperation, enhancing interoperability and exploring avenues of joint training & technology exchange.” At the US State Department, the Air Chief met with Mr. Brown L. Stanley from the Bureau of Political-Military Affairs and Mr. Eric Meyer from the Bureau of South & Central Asian Affairs. Further, as part of his engagements at Capitol Hill, Chief of the Air Staff held dialogue with members of the U.S. Congress, including Mr. Mike Turner, Mr Rich McCormick, and Mr Bill Huizenga. The Chief of the Air Staff highlighted the “historic and multifaceted relationship” between Pakistan and the United States, especially in the domain of defence and security cooperation. The two sides agreed upon the continuation of high-level military interactions in the future. (Kamran Yousaf, “PAF chief visits US to seek deeper defence ties,” The Express Tribune, 3 July 2025)
Pakistan advocates for internal reform of UN’s counterterror architecture
On 1 July, Dawn reported that Pakistan has called for an internal reform of the UN’s counterterrorism architecture with “a balanced and rights-based global framework.” On June 4, Pakistan was appointed as the vice chair of the UN Security Council’s (UNSC) Counter-Terrorism Committee. Permanent Representative of Pakistan to the UN, Ambassador Asim Iftikhar Ahmad, said that the counterterrorism architecture should be able to address prolonged conflicts and that the international community must differentiate between “terrorism and the legitimate struggle against foreign occupation and the right to self-determination.” He highlighted the transnational nature of terrorism, which is enabled by modern Information and Communication Technologies (ICTs), stressing the need for “effective and meaningful” counterterrorism efforts based on “consensually agreed-upon principles driven primarily by member states.” Further, he proposed the integration of Interpol and UN agencies with national law enforcement agencies to improve intelligence sharing relating to the movement of terrorists and terror financing. He also advocated for the merger of some UN entities along with the restriction of their mandates to streamline initiatives. (“Pakistan calls for internal reform of UN’s counterterrorism architecture,” Dawn, 1 July 2025)
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