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In Focus
Inflation hits 11.2 per cent in August
Rising fuel costs and taxes along with failure to secure wheat supplies contribute to higher food prices
On 02 September, The Express Tribune reported that Pakistan’s annual inflation rate surged to 11.2 per cent in August, returning to double digits just one month after falling below 10 per cent. The increase was driven by higher food and energy prices, with the government’s policy of fully recovering fuel costs and taxes from consumers adding to inflationary pressures. Motor fuel prices were 25 per cent higher than a year earlier, while petrol and high-speed diesel carried per-litre taxes of PKR 116 and PKR 101 respectively. According to research by Tola Associates, high-speed diesel prices in dollar terms were the highest in South Asia, while petrol prices were the second highest after Bangladesh. The reading was also slightly above the Finance Ministry’s projection of 10-11 per cent and reflected the government’s efforts to meet IMF-agreed fiscal targets, including a primary budget surplus, partly through increased taxation rather than expenditure rationalisation.
Food prices were another major driver, with food inflation reaching 12.1 per cent in urban areas and 13.2 per cent in rural areas, among the highest levels recorded in recent months. Wheat prices rose 87 per cent year-on-year and wheat flour prices 73 per cent, while tomato and onion prices increased 128 per cent and 125 per cent respectively, amid failures by the Sindh and Punjab governments to meet wheat procurement targets. The federal government subsequently decided to import up to one million tonnes of wheat despite official claims of a 29.7-million-tonne harvest. Transport inflation also rose sharply by 20.2 per cent, reflecting higher fuel and transport costs, while non-food inflation reached 9.4 per cent in urban areas and 11.3 per cent in rural areas. Average inflation during the first two months of the fiscal year stood at 10.2 per cent, above the government’s 8.2 per cent annual target, potentially increasing pressure on the State Bank of Pakistan to raise interest rates despite the Finance Ministry’s assessment that relative exchange-rate stability and macroeconomic discipline had helped preserve broader economic stability. ("Fuel, wheat push inflation to 11.2%," The Express Tribune, 02 September 2026)
Fall in casualties despite rise in militant attacks in August, finds PICSS
Balochistan and KP continue to lead the numbers; Punjab and Sindh record two attacks while Islamabad largely free from violence
On 01 September, Dawn reported that militant attacks in Pakistan increased by 38 percent in August, rising to 199 from 144 in July, even as their human impact declined substantially, according to data from the Pakistan Institute for Conflict and Security Studies (PICSS). The attacks killed 158 people and injured 181, down 41 per cent and 16 per cent respectively from July. Security forces also intensified counter-militancy operations, killing 203 militants among 211 total deaths, while 21 militants were injured and 26 suspected militants arrested. The overall death toll linked to militant attacks and counter-militancy operations fell by 39 per cent, from 606 in July to 369 in August, while the number of security personnel killed declined from 112 to 54. PICSS recorded three suicide attacks during August, including two vehicle-borne attacks, compared with eight in July, while kidnappings fell 36 per cent from 66 to 42.
Balochistan remained the worst-affected province, recording 89 militant attacks in August, up from 83 in July, although deaths from those attacks fell from 162 to 76. Security operations there killed 115 militants. Khyber Pakhtunkhwa saw attacks rise from 36 to 54, while deaths from militant attacks fell from 69 to 44 and security operations killed 56 militants. The merged districts recorded the sharpest increase in attacks, rising from 23 to 52, with deaths from attacks falling slightly from 36 to 34, while injuries rose from 33 to 59. Punjab recorded two attacks that killed three people, while Sindh recorded two attacks and one death; Islamabad, “Azad Jammu and Kashmir”, and “Gilgit-Baltistan” remained largely free of significant militant violence. (“Terrorist attacks increase but fatalities decline during August: PICSS,” Dawn, 01 September 2026; “Militant Attacks Increase but Human Impact Declines in August Amid Sustained CT Pressure: PICSS,” Pakistan Institute for Conflict and Security Studies, 01 September 2026)
PM Shehbaz highlights counterterrorism efforts and IWT at SCO Summit
Pakistan assumed SCO chairmanship as PM calls for stronger regional connectivity, disaster management and backs SCO Bank
On 01 September, Dawn and The Express Tribune reported that Prime Minister Shehbaz Sharif outlined Pakistan’s priorities as Islamabad assumed the Shanghai Cooperation Organisation’s (SCO) 2026-27 chairmanship, focusing on connectivity, innovation and shared prosperity. He proposed cooperation on IT, AI, energy, poverty reduction, disaster management and health, including a framework for sovereign AI infrastructure and governance. He also called for stronger regional transport and energy links and the establishment of an SCO Development Bank.
Addressing the SCO summit in Bishkek, PM Shehbaz said water was the “lifeblood” of the region and must never be weaponised, calling for the Indus Waters Treaty to be honoured. He highlighted Pakistan’s counter-terrorism sacrifices and warned that militant groups using Afghan territory hindered regional peace. Sharif also presented Pakistan as a mediator in the Iran conflict, stressing implementation of the Islamabad Memorandum of Understanding. Lahore was named the SCO’s Tourism and Cultural Capital for 2026-27. (“SCO leaders adopt Bishkek Declaration to expand cooperation on security, trade and technology,” The Express Tribune, 01 September 2026; “PM Shehbaz says water ‘lifeblood’ of region, must never be weaponised,” Dawn, 01 September 2026)
In Brief
ECONOMY
Pakistan initiates the process for five-year and 10-year Eurobond
On 02 September, The Express Tribune reported that Pakistan had launched the process for a US dollar benchmarked dual-tranche Eurobond, following successive sovereign credit rating upgrades, stronger macroeconomic fundamentals and improved investor confidence. This time Pakistan will offer papers for five-year and 10-year tenors, subject to market conditions. The proposed offering covers long maturities of five and 10 years and reflects Pakistan's growing engagement with global investors and its efforts to rebuild a sustainable presence in international capital markets. The latest move follows Pakistan's return to the international capital market in April 2026, when it raised USD 500 million through a three-year Eurobond under its Global Medium-Term Note (GMTN) Programme after a four-year gap. (“Pakistan initiates process for Eurobond,” The Express Tribune, 02 September 2026)
Revenue Board misses projected revenue target by PKR 29 billion
On 01 September, Dawn reported that the Federal Board of Revenue (FBR) collected PKR 901 billion in August, missing the projected target of PKR 930 billion by PKR 29 billion. The collection remained stagnant compared to PKR 900 billion in August 2025. However, the FBR raised PKR 1.722 trillion in the first two months, that is, July-August of 2026-27, exceeding the target of PKR 1.710 trillion by PKR 12 billion. The target for the first two months of FY27 was achieved largely because of higher-than-anticipated collection of sales tax and federal excise duty (FED). However, the collection target of income tax and customs duty was missed. The collection posted a paltry growth of 4 per cent compared to PKR 1.656 trillion in the first two months of FY26. The government has projected an annual revenue collection target of PKR 15.264 trillion for FY27. (“FBR misses august target by Rs29bn,” Dawn, 01 September 2026)
Outflow of black money from Pakistan to Dubai slows amid Iran War
On 01 September, Dawn reported that the Iran War has curbed the outflow of black money from Pakistan to Dubai, while funds already invested are returning and being diverted into property in the country. Thousands of Pakistanis have invested hundreds of millions of dollars in Dubai, particularly in property. Pakistan was identified twice as the second-largest foreign investor in Dubai property. It was widely believed that black money created in Pakistan had a safe haven in Dubai and was a catalyst for property price hikes there. All Pakistan Builders Association Chairman said that about USD 60 million in illegal or black money is created in Pakistan per month and has been invested in Dubai, but this has now stopped. Currency dealers said the higher remittances from Dubai reflect that Pakistanis are sending back their liquid assets to Pakistan. Pakistani investors were trying their best to recover their investments from Dubai, but property prices in the war-affected country have fallen to a minimum level. (“Dubai property no longer safe heaven,” Dawn, 01 September 2026)
POLITICS & GOVERNANCE
Government approaches JI for talks over petroleum price protests
On 02 September, The Express Tribune reported that Jamaat-e-Islami (JI) stated that the government had approached the party for talks over its ongoing protests against petroleum prices and the petroleum levy. JI spokesperson Shakeel Ahmed Tarabi said the party was ready for negotiations provided that the government came with a “complete package” containing relief on the petroleum levy, electricity prices and inflation. Tarabi said Adviser to the Prime Minister and Senator Rana Sanaullah and Federal Minister for Planning Ahsan Iqbal had contacted JI Deputy Emir Liaquat Baloch. Additionally, he added the party’s sit-ins would continue if the government failed to provide meaningful relief. Rana Sanaullah also confirmed the government’s contacts with JI, saying Prime Minister Shehbaz Sharif had formed a three-member negotiating committee comprising Sanaullah, Ahsan Iqbal and Bilal Azhar Kayani, noting that the committee had offered to hold talks at the protest site or another mutually agreed venue and would discuss whether JI demands. (“Govt approaches JI for talks over petroleum prices, levy as party demands ‘complete package’,” The Express Tribune, 02 September 2026)
EXTERNAL
Foreign Minister and UN chief discuss Pakistan's regional mediation at SCO Summit
On 02 September, The Express Tribune reported that the United Nations Secretary-General António Guterres appreciated Pakistan's role in multilateral diplomacy and noted its contributions to promoting regional peace and security. This comes as Deputy Prime Minister and Foreign Minister Ishaq Dar met Guterres on the sidelines of the Shanghai Cooperation Organisation (SCO) Heads of State Summit in Bishkek. Dar reaffirmed Pakistan's commitment to the UN, appreciated Guterres’s leadership, and invited the Secretary-General to visit Pakistan. Guterres accepted Dar’s invite to Islamabad, and exchanged views on regional developments, the upcoming United Nations General Assembly (UNGA), and ongoing work at the UN Security Council. (“UN chief praises Pakistan's multilateral diplomacy,” The Express Tribune, 02 September 2026)
SECURITY
Balochistan: Security forces kill 12 attackers in Chagai following an attack on a Reko Diq convoy
On 01 September, Dawn reported that officials stated that security forces killed 12 armed attackers following a terrorist attack on a convoy of around three dozen empty vehicles. These vehicles were reportedly associated with the Reko Diq copper and gold project in the Nokacha area of Chagai, Balochistan, and were attacked as they travelled to Quetta. The attackers reportedly attempted to intercept the convoy and opened heavy fire, and security personnel escorting the vehicles returned fire, leaving two security personnel injured. Balochistan Chief Minister Mir Sarfraz Bugti stated that 12 terrorists were killed, with arms and ammunition, including heavy weapons, recovered from the attackers. Bugti added that intelligence-based targeted operations against terrorists were continuing across the province and stated, “There will be no negotiations with those who take up arms against the state and shed the blood of innocent citizens.” (“12 assailants killed after Reko Diq convoy comes under attack in Chagai,” Dawn, 01 September 2026)
Balochistan: Six people killed as security forces kill 21 terrorists across multiple districts
On 01 September, Dawn reported that the Inter-Services Public Relations (ISPR) stated that between 31 August and 01 September security forces killed 21 terrorists in Nokcha, Chagai District, Ziarat Cross and Pishin District. ISPR noted that an attack on a customs house killed 10 attackers and added that five security personnel, including two officers and a government official from the Customs Department, were killed. In another incident, on the N-40 Quetta-Taftan Highway, members of a terror group aiming to disrupt movement were apprehended, and 11 terrorists were killed, while weapons, ammunition, and explosives were recovered. (“5 security personnel among 6 martyred in Balochistan Customs House attack, 21 terrorists killed across province: ISPR,” Dawn, 01 September 2026)
Federal government cuts non-prohibited-bore arms licences by over 90 per cent
On 01 September, Dawn reported that the federal government had issued 5,700 non-prohibited-bore arms licences over the previous 13 months, a reduction of more than 90 per cent from the previous annual issuance of over 100,000 licences. Minister of State for Interior Tallal Chaudhry told the Senate Standing Committee on Interior and Narcotics Control that licences were now subject to strict criteria, including a mandatory police character certificate and a parliamentarian’s recommendation, with each National Assembly constituency limited to five recommendations per month. Additionally, Chaudhry said that visas to Afghan nationals were issued only after due diligence and extensions were granted mainly on humanitarian grounds. He added that “60 per cent of those involved in terrorism incidents in Khyber Pakhtunkhwa and Balochistan were Afghan nationals”, stating, “Afghanistan is our neighbour, but its intentions are not right.” The committee was also informed that the Federal Investigation Agency (FIA) does not routinely check passengers’ mobile phones or social media at airports, except in cases that involve information about human smuggling. The meeting also received a briefing on an intelligence-based Sindh Police operation in Shikarpur that recovered a kidnapped minor, Huram Saeed Pathan, who had been abducted from Karachi on 28 March 2026, along with another trafficking victim, Jennifer Amir. (“Govt cuts arms licence issuance by over 90pc,” Dawn, 01 September 2026)
KP: Police and CTD kill two militants in IBO in Lakki Marwat
On 01 September, Dawn reported that the spokesperson for the district police officer in Lakki Marwat said that in a joint operation between the police and the Counter-Terrorism Department (CTD), two terrorists were killed. He said that the operation was launched following “credible information” about the presence of militants. One of those killed was identified as Mubashir, who was reportedly wanted by the CTD in several terrorism-related cases; the second militant remained unidentified. KP Inspector General of Police Zulfiqar Hameed praised the forces for the “successful and result-oriented” operation and said that the police were “fully determined to completely root out the scourge of terrorism." According to a report by the Pakistan Institute for Conflict and Security Studies, mainland KP recorded 154 deaths linked to violence and terrorism in July, up from 75 in June. Security personnel deaths rose from 12 to 38 and terrorist deaths from 37 to 108, while civilian deaths fell from 26 to seven. While terror incidents increased in August, fatalities recorded a fall, according to PICSS data. (“2 terrorists killed in Lakki Marwat IBO: police,” Dawn, 01 September 2026)
PROVINCES
Sindh: CM rules out provincial divisions as assembly debates creation of new provinces
On 01 September, Dawn reported that the Sindh Assembly initiated a debate on the creation of new provinces in the country, including Sindh. The motion, tabled by Pakistan Peoples Party Sindh President and MPA Nisar Khuhro, sought a discussion in the house on the renewed public debate “regarding creation of new provinces and administrative units in Pakistan, including proposals and suggestions which may have the effect of altering the existing territorial limits of the province of Sindh. Chief Minister Syed Murad Ali Shah addressed the house, saying that the outcome of the debate was already clear that Sindh would never be divided. He said that any decision regarding the status or territorial integrity of Sindh rests solely with the provincial assembly. He recalled that the house had repeatedly expressed its position against the division of Sindh through resolutions adopted in 1948, 2000, 2014, 2019, and 2026. The chief minister said the decision regarding Sindh’s division would not be made by businessmen in Lahore, courts, public gatherings, television seminars, or any other forum. It is the elected representatives in the Sindh Assembly who will debate and decide the matter. Muttahida Qaumi Movement-Pakistan (MQM-P) members took part in the debate and defended the idea of administrative units, while rejecting any suggestion of division. MQM-P member Adil Askari questioned why the assembly did not bring a resolution against “Sindhudesh” and said that Karachi South and Karachi West could be considered as administrative units. (“CM Murad rules out Sindh's division as PA opens new provinces debate,” Dawn, 01 September 2026)
Punjab: Assembly passes resolution seeking ban on social media for under-16s
On 01 September, Dawn reported that the Punjab Assembly passed a resolution seeking an effective legal ban on social media accounts for children under 16 years of age. The resolution was submitted to the Punjab Assembly in July by the chairperson of the Child Protection Bureau. The resolution noted that social media use was exposing children to cyberbullying, online sexual exploitation, inappropriate content, mental stress, and other serious risks. It referred to measures introduced in Australia, France, China and several states of the United States to regulate social media use by underage children, and urged the government to introduce similar effective legal safeguards in Pakistan. If adopted by the Punjab Assembly, the resolution will serve as a recommendation to the federal government, which has legislative authority over telecommunications, internet regulation and digital platforms. Meanwhile, the House also adopted a resolution seeking equal religious education facilities and examination opportunities for prisoners belonging to minority communities. The resolution, moved by Treasury member Raheela Khadim and adopted by majority vote, pointed out that under Rule 215 of the Punjab Prison Rules, 1978, prisoners could receive remission in their sentences for acquiring religious education in accordance with the law. (“Punjab assembly passes resolution seeking ban on social media for under 16s,” Dawn, 01 September 2026)
AF-PAK
China pushes revival of Urumqi process to ease Pakistan-Afghanistan tensions
On 02 September, The Express Tribune reported that China stepped up diplomatic efforts to revive its initiative easing Pakistan-Afghanistan tensions, with Special Envoy Ambassador Yue Xiaoyong visiting Islamabad for the second time in five weeks. Yue held talks with Pakistan's Special Representative for Afghanistan Mohammad Sadiq, focusing on the deteriorating regional security environment and growing terrorist threats, particularly from Tehreek-e-Taliban Pakistan (TTP) and East Turkestan Islamic Movement. Ambassador Sadiq described the meeting as "constructive engagement," stating both sides discussed deepening security and counter-terrorism cooperation whilst working through diplomatic means safeguarding regional peace. China hosted the first Urumqi process meeting in April, with representatives from China, Pakistan and Afghanistan holding week-long informal discussions addressing bilateral disputes and terrorism. ("Beijing pushes for revival of Urumqi process," The Express Tribune, 02 September 2026)
Editorials/Opinions
Politics & governance
Editorial, “Terrorism trials,” Dawn, 02 September 2026
"The Punjab Anti-Terrorism (Amendment) Bill, 2026, rests on a real problem. For decades, we have seen terrorism cases collapse and mass murderers go scot-free because those meant to prosecute them had no protection. Witnesses in terrorism trials withdrew their testimony, went missing, or simply refused to appear — they knew the state could not guarantee their safety. Judges hearing sensitive cases have faced threats that no amount of courage can overcome. Justice Arif Iqbal Bhatti was shot dead in his Lahore chambers in 1997, months after acquitting a blasphemy suspect. The delay in concluding such cases means that the accused are not punished and the innocent remain in jail for years. Anonymous courts and identity-shielded proceedings exist in countries, which concluded that open trials mean little if the people running them are dead or too frightened to speak."
https://www.dawn.com/news/2026728/terrorism-trials
Terrorism
Urooj Muqadas, “Women's vulnerabilities amid Balochistan terrorism,” The Express Tribune, 02 September 2026
“The terrorism in Balochistan has featured women's participation, which is an anachronism according to the deeply conservative Baloch patriarchal traditions. Since September 2022, from Shari Baloch to Shaynaz Baloch, women have started participating in violent acts, indicating a departure from traditional norms and enhanced vulnerability to the coercive tactics and propaganda of terrorist organisations like BLA, BLF, and their political front BYC."
https://tribune.com.pk/story/2626952/womens-vulnerabilities-amid-balochistan-terrorism
Energy
Touqir Hussain, “A disaster foretold,” Dawn, 02 September 2026
“Regardless of whoever has ruled Afghanistan, the country has been a problem for Pakistan. Unfortunately, Islamabad’s policy responses have aggravated the issue. The Afghan policy needs a fundamental shift. But that requires a clearer understanding of what went wrong."
https://www.dawn.com/news/2026731/a-disaster-foretold
PIMS tragedy
Muhammad Hamid Zaman, “A choice to not care,” The Express Tribune, 01 September 2026
“The horror of the PIMS tragedy last week has stayed in the news for about a week – as expected – and has already started to fade in the background. Soon, in a manner not unfamiliar to us, it will get lost in the bureaucratic burden of poorly written reports and recommendations that are unlikely to be acted upon. That will follow with a collective memory loss for most, except for those who will carry that burning scar in their hearts and souls for the rest of their lives."
https://tribune.com.pk/story/2626771/a-choice-to-not-care
Economy
Zahid Hussain, “Azad Kashmir saga,” Dawn, 02 September 2026
“Rejected by voters in his own constituency, lawyer Iftikhar Gillani has been chosen as the new prime minister of Azad Jammu & Kashmir. A local PML-N leader, he was elected on a reserved seat for technocrats after losing in the recently held regional elections. His nomination caught even his own party by surprise. Gillani, who had also lost the last election, is not the electorate’s choice — so, whose nominee is he?"
https://www.dawn.com/news/2026734/azad-kashmir-saga
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