Pakistan Business Leaders Urge Clear Economic Roadmap as Indicators Worsen

By Muhammad Shahzad
LAHORE,The Ferozepur Road Industrial Association (FRIA) has urged Pakistan’s government to present a clear and credible economic roadmap, warning that the country’s industrial base is at risk as energy shortages, rising tariffs, and policy uncertainty continue to undermine growth and investor confidence.

FRIA Chairman Shahbaz Aslam said the current fiscal year is shaping up to be one of the most volatile in recent memory, with key economic indicators showing renewed strain despite official claims of stabilisation. Pakistan’s large-scale manufacturing (LSM) output contracted by 0.74% in FY2025, reflecting the toll of high energy costs and inconsistent policy direction.

While inflation has eased from its peak, it remains elevated at 5.6% in September 2025, and foreign exchange reserves—estimated at US$19.8 billion—remain low relative to import needs and external debt obligations.

Aslam said that manufacturing, services, and export-oriented sectors are all under pressure, while small and medium-sized enterprises are being squeezed by rising borrowing costs and uncertainty about energy supplies. “There is no coherent strategy or capable team in place to handle these issues,” he warned. “Weak governance and policy inconsistency are now defining features of Pakistan’s economic setup.”

He criticised the government’s heavy reliance on International Monetary Fund (IMF) prescriptions, particularly currency devaluation and monetary tightening, which he said have deepened inflationary pressures and increased debt servicing costs. “Each round of monetary tightening has hit industrial growth and consumer demand while pushing up inflation,” Aslam added.

Persistent uncertainty over the IMF programme, along with a weak rupee and fragile reserves, has further eroded business sentiment. Aslam urged policymakers to take decisive administrative steps to curb speculative currency demand, attract foreign investment, and stabilise the financial system.

He also called for gradual interest rate reductions, industry-friendly incentives, and affordable energy supplies to revive growth. “If immediate and concrete steps are not taken,” he warned, “the country risks further industrial decline and job losses.”

To build consensus, Aslam proposed convening a national economic conference bringing together business leaders, policymakers, and experts to design a unified recovery plan focused on investment-led growth and policy coherence.

Given the contraction in manufacturing, weak external buffers, and persistent policy drift, FRIA’s call for clarity and coordination reflects growing concern across Pakistan’s business community. Analysts say without a well-defined and credible roadmap, the country’s fragile industrial sector may face deeper structural decline.