PR Daily Brief |  5 & 6 October 2025, Sunday & Monday  | Vol 5, No.249 & 250
In focus
Security sources dismiss report on Pakistan’s offer to the US on Pansi port development and critical minerals shipping
On 5 October, The News International reported that Pakistan’s senior security sources denied a recent Financial Times report stating that Islamabad’s military advisors had approached Washington with an offer to build and run a port in the seaside fishing town of Pasni as a terminal to ship Pakistan’s critical minerals. The report suggested that the offer was shared with some US officials and Field Marshal Asim Munir ahead of his meeting with President Trump in September. The security sources stated that “The Chief of the Army Staff does not have any advisers in an official capacity,” and that such proposals by private individuals and commercial entities were “exploratory and should not be construed as state initiatives.” They also elaborated that Pakistan is exploring various strategic partners for investment and technology to tap into its mineral wealth, be it  the United States, China, Saudi Arabia, or anyone else. The briefing highlighted that “Pakistan’s preference would be a partnership based on its own interest and ground realities.”

The Financial Times report stated that it had reviewed the blueprint of the proposal and indicated that the project would cost nearly USD 1.2 billion, financed by Pakistan’s federal and US-backed development funds. “The proposed port at Pasni would be linked to a new railway to transport minerals from Pakistan’s interior, the advisers said, in particular copper and antimony, a vital ingredient in batteries, fire-retardant, and missiles,” says the report. It also suggested that the plan excludes the use of the port from “direct basing,” of US military installations.

“Pasni’s proximity to Iran and Central Asia enhances US options for trade and security . . . Engagement at Pasni would counterbalance Gwadar . . . and expand US influence in the Arabian Sea and Central Asia,” according to the blueprint. “We don’t need to consult the Chinese as it’s outside the Gwadar concession,” the report quotes one of the Pakistani advisors.
(“Huge potential for ports along Pakistan’s coastline: security sources,” The News International, 4 October 2025; “Pakistan courts US with pitch for new Arabian Sea port,” Financial Times, 4 October 2025)
 
Islamabad federal government signs peace agreement with Jammu Kashmir Joint Awami Action Committee (JKJAAC), ending several days of violence
On 5 October, Dawn reported that the Islamabad federal government has drafted a plan of action addressing the demands of the Jammu Kashmir Joint Awami Action Committee (JKJAAC), following the settlement of the violent protests in the region. The settlement was negotiated by the committee formed by the Prime Minister, and a comprehensive agreement was signed in Muzaffarabad after several rounds of discussion. The agreement states that FIRs shall be registered under the relevant sections of the ATC on incidents of violence and vandalism resulting in the deaths of personnel belonging to the law enforcement agencies (LEAs) and protesters, and a judicial commission shall be appointed where required.

The agreement provides compensation equal to that of law enforcement agencies for those killed in the protests, PKR 1 million for each person injured by gunfire, and a government job for one family member of each deceased within 20 days. A high-powered committee comprising representatives from the federal and POK governments and the JKJAAC will review the issue of 12 refugee seats in Pakistan, with benefits to MLAs from those constituencies suspended pending the report. The cabinet will also be limited to 20 members, overlapping departments will be merged, and the POK Ehtesab Bureau Act will be aligned with Pakistan’s NAB laws. The POK government is instructed to release funds for the health card scheme within 15 days, while MRI and CT machines will be provided to all districts through federal support, alongside PKR10 billion in federal funding to upgrade the electricity system. Two additional education boards will be created in Muzaffarabad and Poonch, all to be linked with the Federal Board in Islamabad within a month. Land held by extended families in Mirpur under the Mangla Dam project will be regularised within 30 days, and the Local Government Act will be revised to reflect the 1990 Act and Supreme Court judgments within 90 days. The federal government will also conduct feasibility studies for two tunnels on the Neelum Valley Road under the Saudi Development Fund’s plan.

A monitoring and implementation committee, comprising federal ministers Amir Muqam and Dr Tariq Fazal Chaudhry, and two nominees from the POK government and the JKJAAC each, will oversee the enforcement of the agreement. PM Shehbaz Sharif termed the agreement a” great achievement,” stating that “Conspiracies and rumours have finally come to an end, and all matters have been resolved amicably.” JKJAAC leader Shaukat Nawaz Mir announced that the six-day lockdown was suspended, “Since the federal negotiating committee has wholeheartedly accepted all our concerns,” and that three days of mourning will be observed to honour those who were killed in the protests.

Separately, national assembly speaker Sardar Ayaz Sadiq has assumed the responsibilities of acting president in the absence of both the president and the Senate chairman, under Article 49(2) of the Constitution. He welcomed the agreement and the restoration of peace and normalcy  in the region and argued that the conspiracies and accusations against Pakistan had been laid to rest. “Pakistan and Kashmir are inseparable. The protection of the rights of the Kashmiri people will always remain our foremost priority,” he underscored. (“Calm returns to AJK after accord,” Dawn, 6 October 2025; “Ayaz Sadiq assumes role of acting president, hails AJK deal,” Dawn, 6 October 2025)
 
Pakistan forms high-level committee for economic talks with Saudi Arabia
On 5 October, The Express Tribune reported that Pakistan’s federal government has constituted an 18-member high-level committee to lead economic negotiations between the two nations under the Pakistan–Saudi Arabia Economic Partnership. The Committee will supervise discussions beyond defence and energy to include environment and climate stability. As trade between Pakistan and Saudi Arabia has increased from USD 3 billion in 2019 to USD 5.4 billion in 2024 remains in favour of Saudi Arabia, Islamabad will seek to enhance Pakistani exports to Saudi Arabia.

Discussions are also expected to focus on the long-delayed oil refinery project, which has been stalled for nearly a decade. Earlier in 2023, Dawn reported that Four Pakistani state-owned petroleum companies signed a memorandum of understanding (MoU) to facilitate USD 10 billion Saudi investment in a new oil refinery at Gwadar, Balochistan with a production capacity of 300,000 barrels per day. Saudi Arabia’s recent surge in bilateral trade and investment in Pakistan marks a significant shift in economic relations; the formation of a committee further will be crucial in forging economic relations between the two nations.
(PM forms panel to boost Saudi ties, The Express Tribune, 6 October, 2025;
Four oil firms sign MoU for $10bn refinery - Business - DAWN.COM, Dawn, 10 October, 2025)
 
In brief
EXTERNAL
PM Sharif emphasises cooperation in varied fronts during official visit to Malaysia
On 6 October, The News International reported on PM Shehbaz Sharif's official visit to Malaysia, accompanied by Deputy Prime Minister and Foreign Minister Ishaq Dar, Federal Minister for Information and Broadcasting Attaullah Tarar, and Special Assistant to the Prime Minister Tariq Fatemi, upon the invitation of the Malaysian government. The meeting focused on discussions on “ enhancing bilateral cooperation in trade to explore opportunities for further cooperation in trade, IT & telecom, Halal industry, investment, education, energy, infrastructure, digital economy, and people-to-people ties.” He highlighted that Pakistan could benefit immensely from Malaysia’s experience in technology, artificial intelligence, and economic growth, and the contributions of the Pakistani diaspora in the country. He also thanked Kuala Lumpur for the educational opportunities extended to the Pakistani students. On the trade and economy front, he thanked Malaysia for announcing a MYR 200 million quota for meat imports from Pakistan. Malaysian PM Ibrahim underscored the importance of peace between Pakistan and India for regional stability, stating that “Peace between Pakistan and India is vital for our region.” He also affirmed Malaysia’s cooperation in combating terrorism. PM Sharif, in a symbolic gesture, praised Prime Minister Anwar Ibrahim’s newly launched book, stating, “This book will serve as a bridge between Islamabad and Kuala Lumpur.” ( “PM Shehbaz lauds Malaysia's warm welcome, stresses closer partnership,” The News International, 6 October 2025)
 
ECONOMY
Pakistan's total public debt surged by 13 per cent
Pakistan’s Ministry of Finance published an Annual Debt Review for FY-25. It stated that in FY25, total Public Debt Stock increased by 13 per cent to 80.5 trillion, with 6 per cent comprising domestic debt and 32 per cent External debt. The major reason for the increase in debt stock was the financing of the federal fiscal deficit, PKR 7.1 trillion, 91per cent of it was financed from domestic (PKR6.4 trillion) and remaining 9 per cent (0.6 trillion) from external sources. FY-25 saw improvement in the maturity profile of domestic debt, with share of short-term Market Treasury Bills (MTBs) declined and share of long-term instruments including fixed and floating rate has increased substantially. External financing saw net retirement in bilateral borrowing, and higher net flows from commercial banking sources.

An editorial in Dawn, highlights reliance on short-term instruments has diminished, which may ease rollover risks. There are  modest improvements and Interest expenditure grew at a slower pace as compared to FY24. Despite inflows from the IMF and ADB, Pakistan's external debt edged up to USD 91.8 billion, with repayment obligations still pressing. In conclusion, Chronic fiscal indiscipline, low tax revenues and sluggish growth ensure that each year begins with higher debt, the government should work on increasing tax revenues and structural reforms.

The review mentioned the key achievements, significantly high annual debt growth rates of 23 per cent  (FY22) and 28 per cent  (FY23) have been successfully contained to 13 per cent  in both FY24 and FY25. Also, in FY25, external debt's share of the total portfolio was reduced from 38 per cent  to 3 per cent, shielding the debt stock from currency fluctuations. In terms of fiscal efficiency, Effective fiscal consolidation led to substantial savings, including a historic PKR 850 billion reduction in interest expenses in FY25.Consequently, the federal fiscal deficit closed at PKR 7.1 trillion, significantly below the budgeted PKR 8.5 trillion.

With Pakistan's external debt repayment obligations still pressing, the debt review provided a background to policy makers to underlying structural challenges that remain stretched. The current fiscal situation demands a comprehensive strategy to strengthen foreign debt fundamentals for a long term fiscal stability.
(Mounting debt pressures, The Express Tribune, 6 October 2025; Annual_debt_review_2025.pdf, Ministry of Finance, Pakistan, 6 October 2025)

Editorials/Opinions
Hamas response, The News International, 5 October 2025
Unfulfilled promises, Dawn, 5 October 2025
Sanity in AJK, The News International, 5 October 2025
More hot air, Dawn, 6 October 2025
Mounting debt pressures, The Express Tribune, 6 October 2025