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In Brief
EXTERNAL
Pakistan in talks with Saudi Arabia to convert loans into JF-17 fighter jet deal
On 07 January, as reported by Dawn, Pakistan and Saudi Arabia are in talks to convert around USD two billion in Saudi loans to a JF-17 fighter jet deal, a Reuters report found. This follows a mutual defence pact the two countries signed in September last year, further deepening military cooperation. Sources said the discussions were limited to the provision of the JF-17 Thunder fighter jets, which Pakistan and China jointly developed. One source stated that the total deal would be worth approximately USD four billion, with an additional USD two billion allocated for equipment. This continues Pakistan’s push to expand arms exports and build on its arms deal with Libya and negotiations with Bangladesh. Pakistan’s Air Chief Zaheer Ahmed Baber Sidhu was in Saudi Arabia for bilateral talks, including on military cooperation. (“Pakistan, Saudi in talks on JF-17 jets-for-loans deal: Reuters report,” Dawn, 07 January 2026)
Pakistan to set up special unit to protect Chinese nationals
On 07 January, as reported by The Express Tribune, Federal Interior Minister Mohsin Naqvi announced the establishment of a special unit in Islamabad to ensure the protection of Chinese citizens. He made the announcement during a visit to the headquarters of the Chinese Ministry of Public Security, where he met Chinese Interior Minister Wang Xiaohong. The two also spoke about counterterrorism cooperation, police training exchanges and Pakistan-China relations in general. They also decided to form a joint working group on internal security, which would meet every three months. The Chinese Interior Minister praised Pakistan’s efforts in counterterrorism and internal security, as well as measures taken to protect Chinese citizens. Additionally, the two also agreed to further strengthen the joint rapid response system against terrorism and crime. Other areas of discussion included cybercrime and AI. “Pakistan and China share an unbreakable bond of enduring cooperation, and no one can create a wedge between us,” Naqvi said. (“Pakistan to set up special unit in Islamabad to protect Chinese citizens,” The Express Tribune, 07 January 2026)
ECONOMY
Pakistan International Airlines: Operational inefficiencies and Spare parts mismanagement cost PKR 30 billion
On 08 January, Dawn reported that the prolonged grounding of Pakistan International Airlines Corporation (PIAC) aircraft led to losses of PKR 22 billion. The Public Accounts Committee was informed that, due to the alleged negligence of its management, PIA failed to dispose of spare parts and retired aircraft, resulting in losses of approximately PKR 8.6 billion from 2015 to 2021. The routine maintenance of PIA aircraft used to take 44 to 239 days, resulting in operational and financial losses to PIA, particularly in 2022. In one case, the aircraft remained grounded for around 652 days. In justification of the Auditor General’s office objections raised to the Parliamentary Committee, the Defence Ministry stated that aircraft were grounded due to global supply disruptions caused by the coronavirus pandemic, and delays in the rollout of aircraft were caused by unscheduled repairs. The Parliamentary committee is also informed that spare parts would be acquired by bidders who purchased PIA. (“PIA incurred Rs22bn loss due to prolonged grounding of aircraft,” Dawn, 08 January 2026)
UAE delegation explores AI and digital infrastructure partnerships in Pakistan
On 08 January, The Express Tribune reported that a Sajwani business delegation from the United Arab Emirates is on a visit to Pakistan to explore collaboration deals in Pakistan’s financial sector. During the meeting with the Finance Minister, the delegation expressed interest in partnering with the government for the development of artificial intelligence, blockchain, and digital infrastructure. The delegation agreed to offer technical expertise, advisory support, and capacity building. These efforts will support Pakistan’s ongoing financial sector reforms and digital transformation agenda and will enhance the Digital Pakistan vision, aimed at building an inclusive, innovation-driven digital economy. (“UAE delegation offers support for AI capacity building,” The Express Tribune, 08 January 2025)
POLITICS & GOVERNANCE
KP CM urges policy shift, seeks provincial consultation on counterterrorism
On 07 January, as reported by Dawn, Khyber Pakhtunkhwa (KP) Chief Minister Sohail Afridi called for a policy shift, emphasising the inclusion of the provincial government in counter-terror policy making as the federal authorities criticise the PTI-led KP government for its failing security in the province. In a speech at Peshawar University’s convocation, the CM addressed the rise of terrorism in the province, whilst mentioning that when the issue was acknowledged, it was brushed off as propaganda by the higher authorities. Additionally, the CM emphasised the need for transparency from the military to regain the confidence of the KP citizens. “A clear policy formed in this manner will play a role in lasting and enduring peace; a decision made behind closed doors will leave our people suffering, as they have for the past 17 years,” he said. Notably, as per the Annual Security Report 2025, there has been a roughly 34 per cent year-on-year surge in violence, with the most significant increase taking place in KP. (“KP CM calls for ‘policy shift’, urges consultation with province on counter-terrorism measures,” Dawn, 07 January 2026)
NDC calls for govt–opposition talks and release of political workers
On 07 January, as reported by Dawn, a group of former PTI leaders and others demanded the release of political prisoners to promote “confidence-building measures" at the national level, during a National Dialogue Committee (NDC) conference in Islamabad. The initiative was led by former Sindh governor Imran Ismail, Dr Shahzad Waseem, and Mahmood Moulvi. As per sources, the NDC extended a special invitation to the TTAP, which was met with dismissal by party authorities. Furthermore, the proposal also suggested that restrictions on political activities should be lifted, the complete freedom of political activities should be ensured within the framework of the Constitution and law. and media censorship be removed. (“Politicos urge govt-opposition talks, seek release of political workers as ‘confidence-building measure,” Dawn, 07 January 2026)
Editorials/Opinions
Terrorism
Editorial, “Terrorism and its epicentre”, The Express Tribune, 08 January 2026
"The armed forces, being at the vanguard of fighting the terror nexus, deserve commendation. The need of the hour is to reorient the policy and make it organic and responsive to the core. The K-P government's criticism of the kinetic approach adopted to stem the rising tide of terrorism is unwarranted and must be revisited. High-profile terror activities can only be dealt with militarily, and there can be no blinking in this regard. However, it is also mandated that the policy of counterterrorism must have an across-the-board consensus, and the federal government should lead from the front in taking along the federating units for ensuring that the strategy is tactical and apolitical. Flushing out the sleeper cells and going after the abettors cannot be delayed any further, and it would be a win-win equation if the locals are taken on board.
https://tribune.com.pk/story/2585968/terrorism-and-its-epicentre
Gas sector debt
Editorial, “Fixing gas sector,” The Express Tribune, 08 January 2026
“Pakistan's gas sector has quietly become home to yet another fiscal monster. Circular debt has crossed Rs3 trillion, including late payment surcharges. Yet, instead of addressing the structural inefficiencies that created this crisis, the state appears poised to once again pass the burden onto citizens through taxes. What makes this approach particularly problematic is that the sources of the gas sector's losses are well known. Unaccounted-for gas, theft, leakage, weak governance and collusion have long plagued the system. Citizens are unjustly told to bear the burden. If the government is serious about fixing the gas sector, it must resist the temptation to raise the amount of taxes and levies and instead solve the root problems plaguing the industry."
https://tribune.com.pk/story/2585969/fixing-gas-sector
Editorial, “Flawed pricing regime,” Dawn, 08 January 2026
“The government’s reported plan of containing the gas sector circular debt of Rs3tr by further raising the petroleum development levy, rather than increasing gas prices as determined by Ogra, underscores the entrenched policy distortions in our energy pricing regime. The gas debt has already grown much larger than the power sector debt. The regulator is recommending an increase of up to 7pc in gas tariffs to generate an additional Rs118 per unit to meet an estimated requirement of Rs886bn in revenue for the two gas utilities in FY26. Under the law, the federal government was required to notify revised consumer prices from Jan 1. Yet, during a parliamentary hearing, the petroleum minister has ruled out an increase for at least the next six months. He did not deny reports that the government may further boost the petroleum levy by Rs5 per litre on petrol and diesel, already taxed at up to Rs82 per litre, to subsidise industrial and urban residential gas consumers. This socialisation of the gas sector’s inefficiencies across the entire population is neither reform nor a sound economic decision. It is, in fact, rooted in politics."
https://www.dawn.com/news/1965738/flawed-pricing-regime
Solving Pakistan
Khurram Husain, “Solving Pakistan,” Dawn, 08 January 2026
“Whenever talking about solutions, it is critical to first have clarity on the problem, because the obvious question is, ‘solution to what?’ When it comes to the economy, for example, are we asking for a solution to the economy’s inability to earn foreign exchange in quantities sufficient to pay for its import requirements? Or are we asking for solutions to the inability to raise revenues in quantities sufficient to pay for the expenditure requirements of the state, without running up unsustainable levels of debt? Speaking of debt, is our envisioned solution to pay this debt down or to raise the state’s capacity to carry the burden of servicing this debt? Are we talking about how to pump growth, or how to bring about a kind of growth that is sustainable, and that lifts people out of poverty, creates opportunities for the young and, overall, secures the livelihoods of the citizenry?"
https://www.dawn.com/news/1965743/solving-pakistan
27th Amendment
Editorial, “Course correction,” Dawn, 08 January 2026
“It has been said at length before, but bears repeating: the 27th Amendment was a monumental mistake. The same has now been underlined by international human rights group Amnesty International, which has described it in its new research report as the “crescendo of a concerted and sustained attack on the independence of the judiciary, right to fair trial, and the rule of law in Pakistan”. That is a sobering assessment, and it should give any well-meaning citizen some pause."
https://www.dawn.com/news/1965739/course-correction
Pakistan after 2025
M Zeb Khan, “Pakistan after 2025: strength without trust”, The Express Tribune, 07 January 2025
"Pakistan enters a new year carrying the institutional imprint of 2025 — strategic vibrancy, diplomatic relevance, but institutional decay and trust deficit. Year 2025 was not a year of dramatic rupture, nor one of decisive renewal. Rather, it consolidated a governing logic that has become increasingly familiar — effective in imposing order, less successful in building trust. This logic may have short-term dividends but undoubtedly long-term disastrous consequences."
https://tribune.com.pk/story/2585800/pakistan-after-2025-strength-without-trust
Geopolitics
Maria Mansab, “Gwadar-Chabahar dynamics: competition or cooperation?” The Express Tribune, 06 January 2026
“Gwadar and Chabahar are often described as "sister ports" due to their geographical proximity (140 km apart) and shared access to similar hinterlands, including Afghanistan, Central Asia, West Asia and Western China. Ultimately, geography encourages complementarity between Gwadar and Chabahar, but geopolitics continues to push them toward competition. As long as great-power rivalry overshadows regional cooperation, Gwadar and Chabahar will be more defined by the strategic contest surrounding the two ports than by their economic potential."
https://tribune.com.pk/story/2585630/gwadar-chabahar-dynamics-competition-or-cooperation
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