2025: A roadmap to economic revival – II

There are 25 additional actionable strategies for sustainable growth, economic resilience

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KARACHI:

For calendar year 2025, I outlined 25 key priorities for Pakistan's economic team in article '2025: A roadmap to economic revival'. To build upon that foundation, here are 25 additional strategies critical to driving sustainable growth and equity.

Reduce population growth rate: Bring the population growth raate below 2.1% to stabilise current levels. Focus on uplifting the socioeconomic conditions of those at the bottom of the pyramid to create a ripple "wealth effect." Avoid reliance on remittances from emigrating middle and lower-income groups to support the economy. Discourage population growth via social benefits: Restrict benefits from programmes like Benazir Income Support Programme (BISP) and Ehsaas to the first two children in each family. This measure indirectly addresses population growth, particularly in rural economies.

Tax water consumption in agriculture: Introduce a water tax for agriculture to discourage cultivation of water-intensive crops such as rice, sugarcane, and cotton. Shift focus to vegetables, fruits, legumes, and import-substituting crops like olives and soybeans.

Increase livestock production: Provide targeted incentives to boost livestock industries, focusing on quality inputs, climate adaptability, and global quality standards to ensure high-value exports.

Free lunch programmes in schools: Launch free lunch initiatives in government schools to nourish the next generation and encourage families to prioritise education over child labour.

Promote data analytics education: Incorporate data analytics into curricula across public, private, and madrassa schools. Provide subsidies for smartphones or set up computer labs, with incentives for female participation, to open freelancing avenues.

Increase female workforce participation: Lower tax rates for companies employing women beyond a threshold. Offer cash allowances for transportation and meals or slightly reduced taxes for female employees to encourage participation.

Establish government-sponsored fitness centres: Create well-equipped fitness centres offering sports and workout facilities to reduce the societal health burden and promote physical well-being.

Recreation centres for the elderly: Set up community centres for individuals above 60 to encourage engagement in voluntary activities like teaching, proofreading, or writing.

Increase mandatory pension contributions: Mandate higher contributions to pension funds to secure post-retirement income, addressing gaps in healthcare and social security services.

Equitable taxation on capital gains: Apply progressive taxes on capital gains, such as 25–30% for frequent trading and lower rates for long-term investors, to promote equity and benefit retail investors.

Competitive bidding for government projects: Ensure transparent and publicised bidding processes to foster efficiency, entrepreneurship, and job creation while avoiding favouritism.

Enhance judicial efficiency: Resolve economic and tax-related disputes promptly to instil confidence in the private sector and meet the International Monetary Fund (IMF) tax targets.

Expand financial limits for lending: Refocus lending on consumers, SMEs, and entrepreneurship. Encourage programmes like the PM Youth Programme to foster economic activity.

Modernise railways: Revamp rail infrastructure using public-private partnerships, introducing fast trains for cargo and passenger transport. A high-speed network can revolutionise exports to Central Asia, inspired by China's success.

Value addition in mineral exports: Mandate value addition in mineral exports, such as processing nickel or gold domestically, to maximise earnings. Exports could increase by $2-$3 billion only from Reko Diq. Ensure federal and provincial governments retain majority stakes in future projects.

Reintroduce tax benefits for IPOs: Provide tax incentives for companies listing on the Pakistan Stock Exchange (PSX). Aim to list 100 IPOs annually to diversify investments, deepen markets, and enhance tax revenues.

Encourage investments in startups and venture capital: Offer nominal tax breaks for startups and venture funds, creating jobs and boosting economic innovation. Idle capital in real estate or T-bills should instead fuel entrepreneurial ventures.

Scholarships for future-ready disciplines: Fund advanced studies in AI, robotics, climate science, and cybersecurity, with return obligations to drive local economic growth.

Competitive electricity trading market: Gradually transition to a private-sector-driven electricity market, enabling industrial zones to operate near low-cost energy sources like Thar.

Expand public transport: Invest in urban public transport systems to reduce pollution, fuel imports, and traffic accidents, potentially saving $10 billion over a decade.

Large-scale olive cultivation: Launch olive cultivation projects to reduce import bills, utilise barren lands, and improve food quality. Focus on exports to ensure profitability.

Integrate into global value chains: Encourage partnerships with global giants, mandating technology transfers to position Pakistan as an industrial hub.

One-stop online solution for businesses: Develop a unified online platform for business registration, tax payments, and utility connections to simplify processes and enhance efficiency.

Reduce government expenses: Limit government expense growth to below export and tax revenue rates. Privatise inefficient departments, freeze hiring, and prioritise education and healthcare spending.

These 50 actionable strategies form a comprehensive blueprint for economic revival.

THE WRITER IS AN INDEPENDENT ECONOMIC ANALYST