Ensuring economic, national security

We are all aware of the short-term economic relief: a 60-year low inflation rate, remittances nearing $4 billion in a month, a current account surplus of nearly $1 billion and global oil prices dropping sharply from the low $80s to the $60s per barrel.

We're also anticipating almost certain inflows of $2 billion from the International Monetary Fund (IMF), including climate-linked funding, a sustainable increase in the tax-to-GDP ratio — though this disproportionately burdens the formal sector — and an astronomical rise in the KSE-100 index to 120,000 points.

Interest rate cuts from the peak of 22% to 10% in the coming months are widely expected. But while these indicators paint a positive picture, the real work begins now.

Geopolitical flashpoints demand economic readiness

Pakistan is now facing two major challenges that demand a shift in economic thinking. First is the recurrence of India-Pakistan tensions – this being the third major flashpoint in a decade after Uri in 2016, Pulwama in 2019 and now Pulwama in 2025. This period has also seen triple economic dips – in 2019 (the IMF-led stabilisation), 2020 (Covid) and 2022-23 (political instability).

While Pakistan's military strength is commendable, this last decade should have been used to strengthen our economic foundations through boosting the foreign exchange reserves, increasing exports and remittances, broadening the tax base, diversifying the economy into agriculture, minerals and IT and repaying external debts consistently.

Water crisis and canal development – unity over provincialism

The second challenge is domestic, which is the controversy around new canals and water distribution. India's threat to suspend the Indus Waters Treaty, which underpins Pakistan's agriculture, food security and social stability, comes at a delicate time.

The Green Pakistan initiative, spearheaded by the Special Investment Facilitation Council (SIFC), seeks to build six new canals – a visionary step. However, it must be clearly communicated to the public and provinces as a national priority rather than a provincial competition.

Zooming in on Pakistan through Google Earth reveals the stunning economic possibilities this land offers. From snow-covered mountains that feed rivers and tourism, to the fertile Indus plain that can feed hundreds of millions globally and onto the mineral-rich western belt of Balochistan, K-P and Sindh, Pakistan is a treasure trove. These areas are not just scenic; they are strategic, waiting to be tapped intelligently for national prosperity.

The canal network planned near the Cholistan Desert is a low-hanging fruit. It can irrigate millions of acres, attract foreign direct investment (FDI) and serve as a testbed for experimental agricultural techniques that can later be scaled nationally.

Similarly, regions between Multan, Sialkot and DI Khan and the eastern belt of Sindh beyond Mirpurkhas, Sanghar, Pano Aqil and Khairpur, all present significant agricultural potential. By engaging global agricultural experts and deploying modern techniques, Pakistan can turn its deserts into breadbaskets.

Pakistan's mineral resources are unparalleled: Thar coal, Reko Diq and the recent finds by National Resources Limited offer decades of energy security and export potential. Add to that our reserves of iron, copper, salt, limestone, rare earths, oil and gas. But exporting raw material is a missed opportunity. We need a robust exploration and value-addition policy to process and export finished products, just as Indonesia has done with palm oil and nickel.

Economic equity: all provinces must win together

The state must play a fatherly role by uniting provincial interests under the umbrella of national development. If Sindh fears water shortages due to canal construction, it should be assured of economic compensation through 25-50% revenue sharing from the Green Pakistan agricultural exports until the eight-million-acre-feet Bhasha Dam storage is completed.

Balochistan and K-P, too, must benefit from mineral FDI, tax revenues, jobs and infrastructure, while the federal government focuses on reducing the external debt and easing the tax burden on the formal sector.

It's unjust that honest industrialists and salaried professionals bear the brunt of taxation while large sectors – retailers, agriculture, real estate, wholesalers and service providers – escape their fair share. If Pakistan is to break its dependency on IMF programmes and endless bilateral rollovers, this imbalance must be addressed through consensus-based reform and enforcement.

In a volatile region, national economic interest must override party or provincial lines. The next decade can only belong to Pakistan if unity and economic clarity guide our path. We must build consensus across the aisle, across provinces and across sectors to explore, dig, drill, irrigate and cultivate, just as the US did during its energy revolution. The slogan for our time should be "Prioritise Pakistan – now or never."

The writer is an independent economic analyst