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In Focus
US proposes additional tariffs on 60 countries including Pakistan
10 per cent rate proposed for Pakistan over alleged failures to act against imports linked to forced labour; EU & China also included
On 04 June, Dawn reported that the United States Trade Representative proposed new duties targeting 60 economies, including Pakistan and India, over alleged failures to act against imports linked to forced labour. Pakistan was among six economies facing a proposed 10 per cent additional duty, subject to public consultation until 06 July. United States Trade Representative Jamieson Greer said trading partners must strengthen enforcement to prevent unfair competition for American workers. The proposal follows legal challenges to US President Donald Trump’s earlier tariff framework and comes ahead of the expiry of a temporary 10 per cent tariff on 24 July.
In response to this, Pakistani exporters expressed confidence that the proposed measure would not significantly damage exports. Former Karachi Chamber of Commerce president Javed Bilwani said Pakistani textile exports already face duties of around 26.5 per cent in the US market, making products comparatively expensive. Exporters argued that buyers in the US absorb tariff costs and noted that Pakistan maintains a trade surplus with Washington. However, they warned that extending additional duties could weaken competitiveness due to Pakistan’s higher energy, financing and production costs. (“US proposes new tariffs on 60 economies, including Pakistan, over failure to act on forced labour,” Dawn, 03 June 2026; “Exporters see no impact of 10pc US duty,” Dawn, 04 June 2026)
In Brief
ECONOMY
Ruling parties continue discussions as budget scheduled for 10 June release
On 4 June, Dawn reported that the PML-N and the PPP, two major ruling partners, continued their consultations on the proposed fiscal measures, with another round of the pre-budget meeting scheduled for later this week. Deputy Prime Minister Ishaq Dar, along with the finance minister, held a meeting with PPP leaders as part of routine pre-budget consultations. Deputy Prime Minister Ishaq Dar announced that the budget would be tabled on 10 June. The PPP leaders opposed new taxes and hoped the government would change its approach to taxation to provide relief to the inflation-hit masses. The PPP delegation emphasised that the government should prefer a broader tax base instead of exerting pressure on the same class which was already paying taxes. The discussions focused on current expenditure and development spending priorities, including the Public Sector Development Programme (PSDP), as well as broader economic priorities such as fiscal sustainability, public welfare measures, development initiatives, and inclusive growth for the fiscal year 2026–2027. (“Another meeting expected as PML-N, PPP continue budget discussions ahead of June 10 presentation,” Dawn, 4 June 2026)
Government trying to incorporate informal economy into tax net, says PM Shehbaz
On 03 June, Dawn reported that Prime Minister Shehbaz Sharif held a meeting with a delegation of renowned businessmen and industrialists. During the meeting, he said that the government was taking measures to bring the informal economy into the tax net in the upcoming budget. PM Shehbaz noted that a strong partnership with the private sector was a guarantee of economic growth and underscored the utmost importance of consulting with them over policymaking for the economy. PM Shehbaz further outlined plans to promote industries that increase domestic production, boost exports, and create maximum job opportunities. The business community was informed that the construction of M-13 Motorway (Kharain-Rawalpindi) will minimise the travel distance between Lahore and Islamabad, and was also briefed on the upgradation of ML-1 and ML-2 railway projects. (“In meeting with business leaders, PM Shehbaz says govt taking measures to bring informal economy into tax net,” Dawn, 03 June 2026)
New oil and gas deposits discovered in Sindh, announces OGDC
On 03 June, The Express Tribune reported that Oil and Gas Development Company Limited (OGDC) announced a significant oil and gas discovery from its exploratory well Bobi Deep-1 in Sindh's Sanghar district. It marked the first hydrocarbon find from the Massive Sand play within the Bobi and Dhamraki Mining Lease. The company said the well successfully tested the Massive Sand interval of the Lower Goru Formation and produced 2,000 barrels of oil per day and 1.1 million standard cubic feet of gas per day through a cased-hole Drill Stem Test (DST). (“OGDC announces major oil and gas discovery in Sindh's Sanghar district,” The Express Tribune, 03 June 2026)
Drop in imports narrows trade deficit by 39 per cent
On 04 June, The Express Tribune reported that Pakistan's merchandise trade deficit narrowed by 39.46 per cent month-on-month in May 2026. According to data released by the Pakistan Bureau of Statistics, it is largely driven by a sharp decline in imports and a rise in exports. Exports increased to PKR 753.7 billion in May from PKR 688.7 billion in April, registering a 9.45 per cent month-on-month increase. Imports, meanwhile, fell by 21.55 per cent to PKR 1.48 trillion from PKR 1.88 trillion in April. The trade deficit stood at PKR 721.6 billion in May 2026, compared with PKR 1.19 trillion in April 2026. This represents an improvement of around PKR 470.4 billion over the previous month. On a year-on-year basis, the trade deficit contracted by 14.35 per cent from PKR 842.5 billion in May 2025 to PKR 721.6 billion in May 2026. (“Trade deficit narrows 39% as imports fall,” The Express Tribune, 4 June 2026)
EXTERNAL
PM Shehbaz pushes for follow-up on recent MoUs with China
On 03 June, Dawn reported that Prime Minister Shehbaz Sharif, during a meeting with Chinese Ambassador Jiang Zaidong in Islamabad, stressed the need to immediately follow up on decisions and memoranda of understanding signed during his recent visit to China. The prime minister emphasised expanding cooperation under CPEC 2.0, particularly in agriculture, IT, industries, including Special Economic Zones, and mines and minerals. Discussions also covered fast-tracking the Karakoram Highway realignment project, strengthening security, counterterrorism and defence cooperation, and enhancing economic and financial support. During the May visit, Pakistan and China signed agreements and MoUs worth more than USD seven billion across sectors, including energy storage, solar technologies and pharmaceuticals. (“PM Shehbaz stresses need to follow up on recent MoUs during meeting with Chinese envoy,” Dawn, 03 June 2026)
Germany & Pakistan oppose proxy warfare, says ambassador
On 03 June, Dawn reported that German Ambassador Ina Lepel said Germany and Pakistan shared common positions on global peace and opposition to proxy warfare, while stressing that key trade corridors, including the Strait of Hormuz, must remain open to avoid economic disruption. Speaking in Islamabad, Ambassador Lepel appreciated Pakistan’s mediation role in helping avert a resumption of conflict between Iran and the United States, while reiterating Germany’s opposition to a nuclear Iran and concern over Tehran’s regional policies. She also highlighted opportunities for deeper cooperation in technology, defence, education and economic development, noting that more than 10,000 Pakistani students are studying in Germany and encouraging greater vocational and language training. (“Germany and Pakistan strongly oppose proxy warfare: ambassador,” Dawn, 03 June 2026)
Italy to provide 10,500 work visas to Pakistanis over three years
On 03 June, The Express Tribune reported that Italy allocated a special quota for 10,500 Pakistani workers over the next three years and issued more than 3,200 student visas for the 2025-26 academic year, reflecting expanding bilateral cooperation. Speaking at Italy’s National Day celebrations in Islamabad, Italian Ambassador Marilina Armellin said migration, education, trade, climate action and cultural ties had become key pillars of relations. She noted that Italy hosts the largest Pakistani community in the European Union and highlighted training programmes to prepare migrants before departure. Ambassador Armellin also pointed to growing business interest in Pakistan, new agreements in technology and defence, and Italy’s continued support for Pakistan’s cultural heritage and regional peace efforts. (“Italy allocates quota for 10,500 Pakistani workers over three years,” The Express Tribune, 03 June 2026)
POLITICS & GOVERNANCE
KP claims centre facing budget shortfall and wants provinces to shoulder burden
On 04 June, Dawn reported that Khyber Pakhtunkhwa Adviser on Finance Muzammil Aslam claimed the federal government was struggling to formulate the budget due to an estimated PKR 1.7 trillion fiscal gap and was seeking greater financial contributions from provinces, particularly Punjab and Sindh. He linked the uncertainty to the cancellation of the National Economic Council (NEC) meeting and delays to the Annual Plan Coordination Committee (APCC) process, warning of market concerns reflected in recent stock market declines. Aslam alleged the Centre was under pressure to meet IMF commitments, including a two per cent primary surplus target, and had sought additional provincial revenue through taxes on property and agricultural income, while coalition demands complicated budget negotiations. (“‘Provinces asked to help fill massive gap in budget’,” Dawn, 04 June 2026)
PPP and PTI flag violations of electoral process in “Gilgit-Baltistan”
On 03 June, The Express Tribune reported that the two major political parties in “Gilgit-Baltistan”, the PPP and PTI, raised concerns over alleged irregularities and interference ahead of upcoming elections. PPP Central Punjab General Secretary Syed Hassan Murtaza criticised the presence of federal ministers and Punjab Senior Minister Maryam Aurangzeb in campaign activities, alleging misuse of government machinery despite election restrictions and calling for action by the election authorities. Separately, PTI Central Information Secretary Sheikh Waqas Akram alleged large-scale pre-poll rigging, claiming party leaders and candidates were being denied entry permits and campaign access. PTI also questioned the transparency of polling arrangements and alleged pressure on candidates and administrative interference in constituencies where it claimed strong electoral support. (“Two leading parties flag 'electoral violations',” The Express Tribune, 03 June 2026)
SECURITY
Government plans new internal security policy
On 04 June, Dawn reported that the federal government sought input from police departments across Pakistan for a new National Internal Security Policy for 2026-30 aimed at centralising police operations, improving interprovincial intelligence sharing, integrating criminal data and curbing terror financing. The policy will be discussed at an extraordinary meeting of the National Police Management Board later this month with participation from provincial police chiefs. National Police Bureau and Federal Investigation Agency (FIA) Director General Dr Usman Anwar said stronger coordination among civil law enforcement agencies was needed to address emerging security challenges. At the same time, proposals also included establishing a Counter-Terrorism Department in “Gilgit-Baltistan” and expanding the National Police Bureau’s role in national policing reforms. (“New internal security policy to centralise police operations,” Dawn, 04 June 2026)
CLIMATE CHANGE
PMD forecasts hotter, drier summer as El Niño expected to develop
On 04 June, Dawn reported that the Pakistan Meteorological Department (PMD) forecast below-normal rainfall and above-normal temperatures across most of Pakistan during June-August 2026. The Met Office said the El Niño phase was expected to strengthen, while the Indian Ocean Dipole could shift into a positive phase by July, contributing to reduced rainfall, especially in Punjab, Sindh, southern Khyber Pakhtunkhwa, and much of Balochistan. Northern regions, including “Gilgit-Baltistan” and northern KP, may receive near-normal to slightly above-normal rainfall. The PMD warned of moisture stress for Kharif crops, rising irrigation demand, heatwaves in southern Punjab and Sindh, and increased risks of flash floods, landslides, urban flooding, dengue and glacier-related hazards in northern areas. (“Below-normal rainfall, above-normal temperatures expected in most parts of country from June to August: PMD,” Dawn, 04 June 2026)
Editorials/Opinions
Pakistan and the IMF
Ali Tauqeer Sheikh, "Weaponising climate," Dawn, 04 June 2026
"In November 1970, the Bhola cyclone killed up to half a million people in East Pakistan. Yahya Khan’s government introduced a 10 per cent surcharge to fund emergency relief. Bangladesh became independent 13 months later. The affected territory was gone. The levy remained. Zulfikar Ali Bhutto’s government absorbed the revenue into general federal accounts in 1972. No accounting was published. In 1985, Gen Zia introduced the Iqra surcharge, framed as an education fund. The revenue balanced federal operating accounts. No alternative education instrument replaced it when it was abolished under the IMF’s insistence. The template was set."
https://www.dawn.com/news/2005045/weaponising-climate
Climate change
Aisha Khan, "Environmental reckoning," Dawn, 04 June 2026
"On every World Environment Day (June 5), nations pause to acknowledge a crisis that has been in the making for over half a century. For Pakistan, a country where floods and droughts occur in a single year, where glaciers and farms are stressed, it should be an unsettling moment. The day should not be seen as a single 24-hour celebration but a serious summons to face the slow-motion emergency we are manufacturing."
https://www.dawn.com/news/2004836/not-a-level-playing-field
Politics & governance
Editorial, "Absentee lawmakers," Dawn, 04 June 2026
"In the current government’s era, we have frequently been told that ‘parliament is supreme’; that it represents the might and majesty of the democratic system at work, and that all other institutions must bow before it. The irony is that it is now being abandoned by some of its most vocal champions. It is no longer a question of whether the institution is failing to work — its own custodians have stopped pretending that it does. That leaves one to wonder: when those charged with keeping parliament alive and running are not even bothering to show up, what do we have left to call supreme?"
https://www.dawn.com/news/2005040/absentee-lawmakers
Terrorism
Durdana Najam, "BLA and the digital weaponisation of women," The Express Tribune, 04 June 2026
"Terrorism in Pakistan is not a new story, but the way it has returned in recent years feels like a cruel repetition of history. It is tearing through Balochistan's social fabric, dragging Khyber-Pakhtunkhwa back by decades, and pushing an already weak economy closer to the edge. Every bomb that goes off does not just kill people; it silently kills classrooms, hospital wards and job opportunities, because more and more of the state's money and attention are pulled into the security vortex."
https://tribune.com.pk/story/2611308/bla-and-the-digital-weaponisation-of-women
On Afghanistan
Editorial, "Taliban's resolve?" The Express Tribune, 04 June 2026
"The decree reportedly issued by the Taliban leadership calling upon the TTP to halt attacks against Pakistan is a welcome development. Nonetheless, the development necessitates some concrete verification from the Afghan regime, as it is merely based on media reports. Exterminating the militants, especially the outlawed TTP, has been a fundamental demand from Islamabad, and it is high time Kabul exhibited responsibility to ensure that warlordism was done away with and serenity was restored on both sides of the divide."
https://tribune.com.pk/story/2611303/talibans-resolve
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