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In Focus
PM Shehbaz arrives in Türkiye for bilateral visit
Talks to focus on trade, investment and regional security; two countries agree to strengthen cooperation in maritime and transport sectors
On 04 July, Dawn and The Express Tribune reported that Prime Minister Shehbaz Sharif arrived in Istanbul on an official visit to Türkiye at the invitation of President Recep Tayyip ErdoÄŸan. According to the government, the two leaders will hold comprehensive talks on bilateral relations, with a particular focus on expanding cooperation in trade, investment and regional security. During the visit, PM Shehbaz is also scheduled to address a Pakistan-hosted business conference highlighting investment opportunities in sectors including special economic zones, energy, information technology and privatisation.
Separately, Pakistan and Türkiye agreed to strengthen cooperation in the maritime and transport sectors during talks in Istanbul between Maritime Affairs Minister Muhammad Junaid Anwar Chaudhry and Turkish Transport Minister Abdulkadir UraloÄŸlu. The discussions focused on expanding collaboration in maritime affairs, transport infrastructure and logistics, following the signing of three energy-sector memoranda of understanding between the two countries last week. ("PM in Istanbul on bilateral visit," The Express Tribune, 04 July 2026; "PM Shehbaz arrives in Turkiye on official visit," Dawn, 03 July 2026; "Pakistan, Turkiye to enhance maritime ties," The Express Tribune, 04 July 2026)
In Brief
EXTERNAL
Pakistani leaders attend funeral of Ayatollah Khamenei in Tehran
On 03 July, Dawn reported that Prime Minister Shehbaz Sharif and Chief of Defence Forces Field Marshal Asim Munir attended the funeral of Iran's assassinated Supreme Leader Ali Khamenei in Tehran, where the prime minister conveyed Pakistan's condolences and solidarity to Iranian leaders, including President Masoud Pezeshkian, and the Iranian people. According to the Prime Minister's Office, PM Shehbaz said Pakistan stood with the "brotherly Iranian nation" during its time of grief and paid tribute to Khamenei, while Pezeshkian described the anticipated mass public turnout as a demonstration of national unity. The Pakistani delegation, which also included Deputy Prime Minister Ishaq Dar, Pakistan Peoples' Party (PPP) Chairman Bilawal Bhutto Zardari and other senior officials, participated in the funeral rites before Sharif departed for an official visit to Türkiye, while Munir returned to Pakistan following the ceremony. ("PM Shehbaz, CDF Munir pay respects to Iran's assassinated supreme leader Khamenei," Dawn, 03 July 2026)
Pakistan & Indonesia agree to expand cooperation on vaccine production
On 04 July, The Express Tribune reported that Indonesia assured Pakistan of full cooperation in vaccine production, technical collaboration and capacity building during a meeting in Geneva between Pakistan's Health Minister Mustafa Kamal and his Indonesian counterpart. Both sides agreed to strengthen cooperation to improve access to modern, high-quality healthcare services, with Indonesia reaffirming its role as Pakistan's leading partner in developing local vaccine manufacturing. ("Indonesia to help Pakistan produce vaccines," The Express Tribune, 04 July 2026)
UK & Pakistan in talks over deportation of Rochdale grooming gang member
On 04 July, Dawn reported that the UK government is in discussions with Pakistan over the possible deportation of Shabbir Ahmed, a dual British-Pakistani national and convicted member of the Rochdale child sexual exploitation scandal, following his release from prison. A spokesperson for British Prime Minister Keir Starmer said the government was doing "everything possible" to remove Ahmed, while acknowledging that any deportation would require Pakistan's agreement and that the case was legally complex because of provisions in the UK's 1971 immigration law. ("UK in talks with Pakistan over deportation of Rochdale grooming gang leader: report," Dawn, 04 July 2026)
ECONOMY
Afghan border closure and Middle East conflict cost Pakistan USD 3.1 billion in trade
On 04 July, The Express Tribune reported that the National Assembly Standing Committee on Commerce was informed that the closure of the Afghan border had cost Pakistan USD 1.1 billion in export losses, while the Middle East conflict had eroded overseas shipments by an estimated USD two billion, with transit trade and exports declining by USD 1.2 billion during the first nine months of the current fiscal year. Commerce Secretary Jawad Paul told the committee that the food sector recorded a 25 per cent decline in exports, with rice shipments falling sharply due to Indian competition. Pakistani rice, priced at around USD 1,300 per tonne, is losing market share to Indian rice selling at approximately USD 1,100 per tonne, despite being considered superior in quality. Officials noted unsubstantiated complaints that Indian traders were rebranding Pakistani rice before selling it abroad. The committee also approved the Copyright (Amendment) Bill 2026 and was briefed on the proposed Insurance Bill 2026, which would replace the existing 25-year-old insurance law with entirely new legislation drafted by the SECP, opening the sector to greater competition, simplifying licensing, and strengthening consumer protections for policyholders. ("Rice exports hit by Indian price edge," The Express Tribune, 04 July 2026)
Weekly inflation rises 13.52 per cent year-on-year as energy and food costs weigh on households
On 04 July, Dawn reported that the Sensitive Price Index rose 13.52 per cent year-on-year for the week ending 2 July, driven by sharp increases in electricity charges (49.14 per cent), wheat flour (68.47 per cent), and LPG (44.08 per cent), alongside elevated food prices for onions, tomatoes, potatoes, mutton, beef and wheat flour. On a week-on-week basis, the SPI declined 0.98 per cent, partly due to recent petroleum price cuts, though the government has kept petrol and diesel prices unchanged despite international oil prices falling below pre-war levels. The SPI has now recorded an annual increase for 45 consecutive weeks. ("Costly energy, food fuel weekly inflation," Dawn, 04 July 2026)
18 per cent sales tax triggers factory shutdowns and price crash in Pakistan's cotton ginning sector
On 04 July, Dawn reported that several cotton ginning factories in Tando Adam and other key towns have begun shutting down just one month after becoming operational, in what industry representatives are describing as an unprecedented crisis for Pakistan's textile sector. The shutdowns follow the government's failure to reduce the 18 per cent sales tax on the cotton ginning sector in the federal budget, despite explicit assurances from ministers and senior bureaucrats to Aptma and cotton ginners that the tax on cottonseed and oil cake would be abolished and the tax on raw cotton significantly reduced. The broken promise triggered a market crash, with the Karachi Cotton Association spot rate falling PKR 4,000 to PKR 17,500 per maund, Punjab cotton prices dropping PKR 5,000 to PKR 17,800, cottonseed tumbling from PKR 4,800 to PKR 3,400 per maund, and oil cake from PKR 5,200 to PKR 3,500. Industry leaders warned prices could fall further. Extreme heatwaves have compounded the crisis by reducing lint yield and cotton quality. The Pakistan Cotton Ginners Association also warned that the tax burden is driving the cotton economy underground, citing a 1.5 million bale documentation gap in FY2025-26 between official figures of 5.5 million bales and estimated actual production of seven million bales. ("18pc sales tax cripples cotton ginning," Dawn, 04 July 2026)
Government cuts petrol and diesel prices by PKR 1.97 per litre
On 04 July, Dawn reported that the government reduced petrol and diesel prices by PKR 1.97 per litre each with immediate effect, setting petrol at PKR 297.53 and high-speed diesel at PKR 309.50 per litre for the week ending 10 July. The cuts partially pass on lower global oil prices, though the government slightly increased the petroleum levy on both products, limiting what would otherwise have been reductions of around PKR 11 and PKR 4 per litre respectively. Petrol has now cumulatively fallen around PKR 109 per litre from its April 3 peak of PKR 458.41, while diesel has declined from a peak of PKR 520.35. Total taxes on HSD stand at around PKR 101 per litre and on petrol at PKR 95 per litre, including customs duty, petroleum levy, and the climate support levy, which was doubled to PKR 5 per litre from 1 July under IMF conditions. ("Govt slashes petrol, diesel prices by Rs1.97," Dawn, 04 July 2026)
SOCIETY
Karachi to vaccinate 2.5 million children in week-long polio campaign
On 04 July, Dawn reported that authorities in Karachi will launch a week-long polio vaccination campaign from 06 to 12 July targeting more than 2.5 million children under the age of five. Around 26,000 polio workers and 7,000 police personnel will be deployed for the drive, while Commissioner Syed Hassan Naqvi said efforts would focus on door-to-door immunisation, improving data collection and reaching children who had previously been missed or whose parents had refused vaccination. ("Over 2.5m children to be vaccinated against polio in Karachi," Dawn, 04 July 2026)
Editorials/Opinions
On the US
Farrukh Khan Pitafi, “On America's 250th,” The Express Tribune, 04 July 2026
“Because of its international politics, America evokes many sentiments. But as Tocqueville wrote in the first volume of his Democracy in America: "The great privilege of the Americans does not simply consist in their being more enlightened than other nations, but in their being able to repair the faults they may commit." Among free societies, America remains the largest permission structure ever built for human ambition. Let Lady Liberty's torch burn bright, America. It is badly needed today."
https://tribune.com.pk/story/2616349/on-americas-250th
Economy
Editorial, “Unfinished business,” Dawn, 03 July 2026
“The landmark 18th Amendment and seventh NFC Award radically reshaped Pakistan’s fiscal federalism by transferring greater powers and financial resources to the provinces so that authority would eventually flow closer to citizens through local governments."
https://www.dawn.com/news/2012614/unfinished-business
Politics & governance
Imtiaz Gul, “The social contract,” The Express Tribune, 04 July 2026
“Official discourse in conflict-stricken societies often returns to one word: loyalty to the state. In Pakistan, loyalty to the state is presented almost as an automatic duty of every citizen. Serving and retired officials, often speaking from secure and comfortable spaces, tend to equate loyalty with unquestioning compliance with Article 5 of the Constitution. That article says loyalty to the State is the basic duty of every citizen, and obedience to the Constitution and law is an inviolable obligation."
https://tribune.com.pk/story/2616350/the-social-contract
Mohammad Younus Dagha, “Sindh’s NFC paradox,” Dawn, 04 July 2026
“While presenting the current Sindh budget — the province’s 16th since the seventh NFC Award went into effect — Chief Minister Murad Ali Shah attributed the sharp reduction in development spending to the grant of Rs260 billion for the federation that Sindh agreed to at the National Economic Council meeting of June 10, 2026. The figures, however, suggest a very different story."
https://www.dawn.com/news/2012886/sindhs-nfc-paradox
Terrorism
Editorial, “Terrorism numbers,” Dawn, 04 July 2026
“As Pakistan continues to grapple with the menace of militancy, the number of terrorist attacks present a mixed picture. According to the Islamabad-based Pakistan Institute for Conflict and Security Studies, the number of terrorist attacks in the country dipped by 16pc in June as compared to May. Casualties amongst the security forces and civilians also dropped. While this may highlight a positive trend, indicating that counterterrorism efforts are producing results, the data shows, at the same time, that high-profile attacks, including suicide bombings, continue to pose a challenge. The latest such attack occurred last week targeting a Rangers’ facility in Karachi. Balochistan has witnessed a 31pc reduction in attacks, but while attacks in KP’s tribal districts are also down, the rest of the province saw a “slight increase” in terrorist activity."
https://www.dawn.com/news/2012887/terrorism-numbers
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