Federal Minister for Planning and Development Ahsan Iqbal has said that Pakistanis pay the lowest taxes in the world, while the foundation of any strong economy rests on taxes, exports, and foreign investment.
Addressing an event in Karachi, he stated that just two years ago the country was in a severe crisis, and on April 1, 2022, Pakistan had already internally defaulted. At that time, speculation was rife about when an external default would occur.
Ahsan Iqbal said that the nation supported the government in making difficult decisions during those critical times, and today the country is being recognized for macroeconomic changes. He noted that the interest rate, which once stood at 22 percent, has now dropped to 11 percent, and every international rating agency has improved Pakistan’s rating.
The minister said that Pakistan has now been given a new opportunity to move forward, although previous three attempts to stabilize the economy had failed. During that period, the government was struggling in by-elections while their popularity was at its peak.
He added that Pakistan still has to borrow to meet other expenditures, with the budget deficit standing at over six percent. He admitted that exports have not grown in line with the global pace, and there is intense competition for foreign investment.
Ahsan Iqbal further explained that due to the NFC Award, 60 percent of revenue was previously transferred to the provinces, while the remaining 40 percent was consumed by debt repayments. However, reforms over the last two years have created a fiscal space of 2.8 trillion rupees, allowing the government to independently cover the defense budget of 2.5 trillion rupees.
