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Pakistan Battery Energy Storage Policy to Boost Local Manufacturing as Government Targets 90 Percent Clean Energy by 2035
Pakistan

Pakistan Battery Energy Storage Policy to Boost Local Manufacturing as Government Targets 90 Percent Clean Energy by 2035

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Pakistan is preparing to introduce a comprehensive Pakistan Battery Energy Storage Policy that could significantly reshape the country’s renewable energy sector by encouraging domestic manufacturing of battery energy storage systems (BESS). The proposed framework promises incentives for local producers while reducing dependence on imported storage technologies, a move that could create new industrial opportunities, generate skilled employment, and strengthen Pakistan’s long-term energy security. The announcement was made by Minister for Power Sardar Awais Ahmad Khan Leghari during the Solar Storage Flexibility 2026 Conference in Islamabad, where he revealed that the Ministry of Industries and Production is finalizing the policy before its official launch. The initiative comes at a time when Pakistan is rapidly expanding renewable energy generation but continues to rely heavily on imported battery storage solutions, exposing the country to currency volatility, supply chain disruptions, and rising technology costs. Pakistan Battery Energy Storage Policy Aims to Build a Local Industry According to the minister, the Pakistan Battery Energy Storage Policy will not merely encourage the assembly of imported products but will seek to establish domestic expertise in battery system design, engineering, integration, maintenance, and eventually full-scale manufacturing. This represents a strategic shift from simply purchasing foreign technology to developing an indigenous industrial ecosystem capable of serving Pakistan’s growing renewable energy market. If implemented effectively, the policy could attract private investment into battery manufacturing facilities, encourage technology transfer, and reduce the country’s dependence on expensive imports over the coming decade. However, achieving these objectives will require more than financial incentives. Investors typically seek regulatory certainty, consistent taxation policies, affordable financing, and long-term demand visibility before committing billions of rupees to advanced manufacturing facilities. Universities Will Play a Key Role in Battery Manufacturing Sardar Awais Leghari emphasized that universities and technical institutions must prepare a skilled workforce capable of supporting Pakistan’s emerging battery industry. The government believes higher education institutions should develop specialized programs focused on battery technology, energy storage engineering, maintenance, and research. Without qualified engineers and technicians, Pakistan’s ambition to establish a competitive domestic battery manufacturing industry could face significant challenges. Developing local expertise would also reduce reliance on foreign technical consultants while creating high-value employment opportunities for engineering graduates. Clean Energy Targets Are Ambitious but Execution Remains the Real Test The minister highlighted that nearly 55 percent of Pakistan’s electricity generation currently comes from clean energy sources. He further announced the government’s goal of increasing that share to 90 percent by 2035. The target reflects Pakistan’s commitment to accelerating its energy transition while reducing dependence on fossil fuels. Yet the announcement also raises important questions. Setting ambitious renewable energy goals has become increasingly common across developing economies, but implementation often falls behind policy announcements. Pakistan’s energy sector continues to face persistent issues including transmission bottlenecks, circular debt, delayed infrastructure projects, and inconsistent regulatory decisions. Without addressing these structural problems alongside battery manufacturing, expanding renewable generation alone may not deliver the expected improvements in grid reliability or lower electricity costs. Battery energy storage systems can play a crucial role in stabilizing the grid by storing excess solar and wind power and supplying electricity during peak demand. However, storage technology should complement broader reforms rather than substitute for them. Why the Pakistan Battery Energy Storage Policy Matters The Pakistan Battery Energy Storage Policy could become one of the country’s most significant industrial and energy reforms if accompanied by transparent implementation, investor-friendly regulations, and strong public-private collaboration. Beyond supporting renewable energy, local battery manufacturing has the potential to stimulate industrial growth, create thousands of skilled jobs, improve technology transfer, and reduce Pakistan’s growing import bill. The coming months will determine whether the policy evolves into a transformative industrial strategy or joins the long list of well-intentioned initiatives that struggled due to weak execution. For investors, manufacturers, and the renewable energy industry, the final policy framework will be closely watched as a key indicator of Pakistan’s commitment to building a competitive clean energy economy. Future Success Will Depend on Effective Implementation While the Pakistan Battery Energy Storage Policy has the potential to strengthen Pakistan’s renewable energy sector and industrial base, its long-term success will depend on effective implementation, policy consistency and sustained private-sector participation. If supported by the right regulatory environment and investment incentives, the policy could play a pivotal role in achieving the country’s clean energy ambitions while fostering a competitive domestic battery manufacturing industry.

HugoBank Receives SBP Approval to Launch Pilot Digital Banking Operations
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HugoBank Receives SBP Approval to Launch Pilot Digital Banking Operations

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HugoBank pilot operations approval marks a significant milestone for Pakistan’s digital banking sector after the State Bank of Pakistan (SBP) allowed the Karachi-based digital retail bank to begin testing its banking platform, products and operational systems before its full commercial launch. The approval enables HugoBank to offer services to a limited group of customers in a controlled environment, allowing the bank to evaluate its technology, operational processes and customer experience while ensuring compliance with the SBP’s regulatory requirements. The development reflects the central bank’s broader efforts to promote innovation, strengthen financial inclusion and accelerate the growth of digital banking across Pakistan. HugoBank to Test Products and Banking Systems According to an official statement issued on Wednesday, the HugoBank pilot operations approval allows the bank to assess its digital banking infrastructure, cybersecurity framework and customer support systems under real-world conditions. During the pilot phase, the bank will gather customer feedback to identify areas for improvement before expanding its services to the wider public. Officials said the controlled testing period has been designed to ensure that HugoBank’s systems meet regulatory standards while delivering a secure and seamless banking experience. Banking experts believe pilot operations are a critical stage in launching digital banks, as they help identify potential operational risks before full-scale commercial operations begin. HugoBank Received Initial Approval in 2023 HugoBank’s journey towards becoming a fully licensed digital bank began in 2023 when it received in-principle approval from the State Bank of Pakistan. The approval followed the SBP’s introduction of a comprehensive digital banking licensing framework in 2022, aimed at encouraging innovation and expanding access to financial services across the country. HugoBank was among five institutions selected to establish digital retail banks under the new regulatory framework. Since then, the bank has been developing its technology, operational systems and digital infrastructure in preparation for entering Pakistan’s growing fintech market. Industry analysts believe digital banks can play an important role in improving financial inclusion, particularly in underserved areas where access to conventional banking services remains limited. CEO Highlights Vision for Digital Banking HugoBank Chief Executive Officer Asim Hassan welcomed the latest regulatory approval, describing it as an important step towards providing accessible and technology-driven banking services. He said the bank aims to offer customers a seamless, secure and convenient banking experience through digital innovation. According to Hassan, simplifying banking services is essential for improving financial freedom and expanding access to formal financial products. The bank also reaffirmed its commitment to supporting Pakistan’s digital economy by delivering efficient financial services through a modern digital platform. Digital Banking Sector Continues to Expand Pakistan’s banking industry has experienced rapid digital transformation in recent years, driven by increased smartphone usage, mobile banking applications, digital wallets and electronic payment systems. Financial institutions are investing heavily in technology to improve customer experience, expand financial inclusion and reduce dependence on traditional branch-based banking. Experts believe growing competition among digital banks will encourage innovation, improve service quality and provide consumers with greater access to modern financial solutions. The successful completion of the HugoBank pilot operations approval phase will be an important milestone before the bank moves towards a full commercial launch, further strengthening Pakistan’s evolving digital banking ecosystem. Digital Banking Signals a Shift in Pakistan’s Financial Landscape The HugoBank pilot operations approval represents another step forward in Pakistan’s transition towards a more technology-driven financial sector. As digital banking adoption continues to grow, successful pilot programmes will be essential in ensuring secure, efficient and customer-focused financial services before they are rolled out nationwide.

Pakistan Unemployment Rate Climbs to 7.1% as Nearly Six Million People Struggle Without Jobs
Pakistan

Pakistan Unemployment Rate Climbs to 7.1% as Nearly Six Million People Struggle Without Jobs

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Pakistan’s unemployment crisis has deepened as the Pakistan Unemployment Rate has increased to 7.1 percent, leaving approximately 5.9 million people without employment. The latest labour market data highlights a troubling trend for an economy already facing weak investment, slow industrial growth, and declining business confidence. The rising unemployment figures are more than just statistics. They reveal a widening gap between economic promises and ground realities. While policymakers continue to speak about economic recovery and investment opportunities, millions of Pakistanis remain unable to find stable employment. The latest numbers raise serious questions about whether current economic policies are creating enough productive jobs to absorb the country’s rapidly expanding workforce. Pakistan Unemployment Rate Continues an Upward Trend According to the latest available data, the Pakistan Unemployment Rate has increased from 6.3 percent in 2020-21 to 7.1 percent in 2024-25. During the same period, the number of unemployed individuals rose from 4.51 million to 5.9 million, representing an increase of nearly 1.39 million people. This sharp rise reflects growing pressure on Pakistan’s labour market despite repeated claims of economic stabilization. Pakistan’s total labour force reached 83.1 million people during 2024-25. Out of this workforce, approximately 77.2 million individuals were employed. While employment has increased in absolute numbers, it has failed to keep pace with the rapid growth of the labour force, leaving millions searching for work. Youth Unemployment Is Becoming a National Economic Threat The most alarming aspect of the latest labour market data is the impact on young Pakistanis. Pakistan has around 46.3 million people between the ages of 15 and 24. Among them, approximately 20.6 million participate in the labour force. However, only 17.9 million have employment, while nearly 2.6 million young people remain unemployed. The data further shows that unemployed youth include approximately 2 million men and 700,000 women, demonstrating that job creation has failed to meet the needs of both genders. Youth unemployment creates long-term economic risks that extend beyond income loss. Prolonged unemployment reduces workforce productivity, increases poverty, encourages skilled workers to migrate abroad, and weakens future economic growth. Without meaningful reforms, Pakistan risks losing one of its greatest assets, its young population. Why the Pakistan Unemployment Rate Keeps Rising Economic experts attribute the increase in the Pakistan Unemployment Rate to several structural problems. The country’s economic growth has remained relatively slow, limiting business expansion and private-sector hiring. Investment levels continue to fall short of what is required to generate large-scale employment. At the same time, many graduates and job seekers lack the skills currently demanded by employers, creating a significant mismatch between education and market needs. Complicated regulatory procedures also discourage domestic and foreign investment, while limited overseas employment opportunities have reduced an important source of jobs for Pakistani workers. These challenges have combined to create an environment where workforce growth continues to outpace employment creation. Economic Recovery Must Be Measured by Jobs, Not Headlines The rising Pakistan Unemployment Rate deserves greater public attention because employment remains one of the strongest indicators of economic health. While government officials frequently highlight improvements in inflation, foreign exchange reserves, or stock market performance, these indicators alone do not reflect the financial condition of ordinary households. Economic recovery cannot be considered complete when nearly six million people remain unemployed and millions of young people struggle to enter the workforce. The latest figures suggest that Pakistan urgently needs policies focused on attracting private investment, expanding industrial production, supporting small and medium-sized businesses, improving vocational training, and simplifying regulations for investors. Without sustained job creation, economic growth risks becoming concentrated in financial indicators rather than translating into improved living standards for the broader population. Pakistan’s Labour Market Faces Long-Term Challenges The latest labour market figures send a clear warning. The Pakistan Unemployment Rate reaching 7.1 percent is not merely a statistical increase but a reflection of deeper structural weaknesses within the economy. Unless investment, industrial expansion, education reforms, and labour market policies move together, unemployment is likely to remain one of Pakistan’s biggest economic and social challenges in the coming years.

Bangladesh Seeks India's Position on Sheikh Hasina's Planned Virtual Address
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Bangladesh Seeks India’s Position on Sheikh Hasina’s Planned Virtual Address

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Bangladesh has urged India to clarify its position regarding Sheikh Hasina’s planned virtual address, warning that political activities by the former prime minister from Indian territory could undermine efforts to improve relations between the two neighbouring countries. Bangladesh Responds To Sheikh Hasina’s Planned Virtual Address The statement marks the first official reaction from Dhaka to Sheikh Hasina’s planned virtual address, which is scheduled to take place at an event in New Delhi on August 5. The programme has been organised by the Foreign Correspondents’ Club of South Asia (FCCSA) to mark the second anniversary of the student-led uprising that led to the collapse of her government. Hasina, 78, has been living in India since leaving Bangladesh in August 2024 after weeks of nationwide protests that eventually forced her administration from power. The controversy has emerged at a time when Bangladesh continues to seek her extradition. Despite facing several criminal cases, Hasina recently told Reuters that she intends to return to Bangladesh in December. Bangladesh’s State Minister for Foreign Affairs, Shama Obaed Islam, said Dhaka remained committed to maintaining positive ties with New Delhi but expected greater clarity regarding the issue. “We are moving forward with India with a forward-looking approach. We don’t want that progress to be affected,” she told reporters. “India has to be clear about its stance.” According to the FCCSA, Hasina will deliver her speech through a video link and will be joined by her son, Sajeeb Wazed Joy, and several other speakers. Bangladesh Raises Diplomatic Concerns Bangladeshi officials said they had repeatedly informed India of their concerns regarding statements made by Hasina and other senior members of the Awami League while residing in India. Shama Obaed Islam stressed that Bangladesh did not want bilateral relations to suffer because of political statements made by individuals facing legal proceedings in their home country. She added that India had previously indicated that fugitives would not be permitted to engage in political activities from Indian territory. Although the event is being organised by an independent organisation rather than the Indian government, Bangladeshi authorities have signalled that the matter could be pursued through diplomatic channels if required. India’s Ministry of External Affairs has not yet issued an official statement on the matter. Bangladesh-India Relations Remain Under Watch Relations between Bangladesh and India have remained under strain since Hasina’s departure from office. However, both governments have recently indicated a willingness to strengthen cooperation through diplomatic engagement and expanded economic ties following the formation of Bangladesh’s new administration after elections held earlier this year. Following her removal from power, Bangladesh formally requested Hasina’s extradition. In 2025, she was sentenced to death after being convicted of crimes against humanity in connection with the government’s response to the 2024 protests. According to United Nations estimates, as many as 1,400 people lost their lives during the unrest. Hasina has strongly rejected the charges against her, arguing that the ruling has no legal basis. The latest dispute highlights the delicate nature of relations between Dhaka and New Delhi as both countries attempt to balance diplomatic cooperation with growing political sensitivities.

Pakistan-Iran FTA Talks Accelerate as Both Countries Target $10bn Trade Volume
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Pakistan-Iran FTA Talks Accelerate as Both Countries Target $10bn Trade Volume

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Pakistan and Iran on Tuesday agreed to speed up negotiations on the Pakistan-Iran FTA, with officials from both countries emphasising the importance of concluding the agreement as early as possible to strengthen economic ties and increase bilateral trade. The Decision Taken At 10th Pakistan-Iran Joint Trade Committee Meeting The decision was taken during the 10th Pakistan-Iran Joint Trade Committee (JTC) meeting held in Islamabad. The meeting was jointly chaired by Commerce Minister Jam Kamal Khan and Iranian Minister of Industry, Mine and Trade Dr Mohammad Atabak. Both sides reaffirmed their commitment to increasing annual trade between the two neighbouring countries to $10 billion. Speaking at the meeting, Jam Kamal Khan said the longstanding and brotherly relationship between Pakistan and Iran should now be transformed into a stronger economic partnership through the completion of the Pakistan-Iran FTA. He stressed that eliminating obstacles related to customs procedures, transportation networks and border logistics would play a crucial role in facilitating trade activities. According to the commerce minister, the establishment of joint border markets and the implementation of an electronic data interchange system could significantly improve trade efficiency and increase the volume of commercial activity between the two countries. “The private sectors of both countries are prepared for greater cooperation, and it is now the responsibility of governments to provide a stable and reliable business environment,” he said. Jam Kamal Khan added that the 10th JTC meeting would provide a practical framework for enhancing trade relations and expanding economic cooperation in the years ahead. Iran Highlights Regional Connectivity And Trade Potential Iranian Minister Dr Mohammad Atabak described Pakistan as one of Iran’s most important long-term trading partners and highlighted the importance of expanding regional trade links through the ports of Karachi and Gwadar. He also expressed optimism that negotiations on the free trade agreement would soon reach a successful conclusion. The Iranian minister identified electricity trade, infrastructure development and regional connectivity projects as areas with considerable potential for future cooperation. Officials from both countries reaffirmed their determination to strengthen collaboration in investment, trade, logistics and private-sector development. The meeting reflected the shared desire of Islamabad and Tehran to create new business opportunities and deepen economic integration across the region. Pakistan-Iran PTA And Existing Trade Framework The Joint Trade Committee serves as the main institutional platform for discussions related to bilateral trade and investment. Since its establishment, nine meetings have been held, with the ninth session taking place in Tehran in November 2021. Pakistan and Iran already have a Preferential Trade Agreement (PTA), which came into force on September 1, 2006. Under the existing arrangement, Pakistan offers tariff concessions on 338 product categories, while Iran extends concessions on 309 categories. The average reduction in tariffs stands at approximately 18%. Despite the agreement, Pakistani exporters continue to face challenges because of higher tariffs imposed on their products in the Iranian market. In contrast, Iranian exports entering Pakistan benefit from comparatively lower duties. Analysts believe that a comprehensive free trade agreement could help address these imbalances while creating opportunities for businesses on both sides of the border. Greater trade cooperation is also expected to improve regional connectivity, strengthen supply chains and support economic growth in both countries.

Oil Prices Climb 1% Amid Growing Strait of Hormuz Supply Concerns
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Oil Prices Climb 1% Amid Growing Strait of Hormuz Supply Concerns

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Oil Prices Climb 1% on Tuesday as investors reassessed geopolitical risks in the Middle East following a sharp decline in the previous trading session. Concerns over potential disruptions to global energy supplies and uncertainty surrounding negotiations between the United States and Iran continued to support the market. Oil Prices Recover After Sharp Decline Traders remained cautious despite comments from US President Donald Trump, who indicated that Washington was delaying further military action against Iran while diplomatic efforts continued. Brent crude futures for the front month rose by $1.12, or 1.3%, to $84.89 per barrel by 0355 GMT. The benchmark had fallen about 7% during the previous session, reaching its lowest level in three weeks. Meanwhile, US West Texas Intermediate (WTI) crude futures climbed by 77 cents, or nearly 1%, to $81.11 per barrel after recording losses of more than 5% a day earlier. The earlier decline in prices followed remarks by President Trump, who said the United States was temporarily postponing further attacks on Iran while discussions aimed at ending the conflict continued. However, sentiment shifted once again after Iranian officials denied that any negotiations with Washington were underway. Iranian Foreign Ministry spokesman Esmail Baghaei dismissed claims that talks were taking place, saying no meetings between the two sides had been scheduled. His remarks reinforced fears that regional tensions could intensify and disrupt global oil supplies. Strait Of Hormuz Remains A Key Risk The Strait of Hormuz remains at the centre of the dispute. The strategic waterway is one of the world’s most important energy routes, connecting oil-producing countries in the Gulf region with international markets. Before the conflict escalated, nearly 20% of the world’s crude oil and liquefied natural gas shipments passed through the narrow passage, highlighting its significance to the global economy. Analysts at ING said the market reaction may have been excessive, given the continued uncertainty surrounding the conflict. “The scale of the sell-off seems fairly overdone, given that there’s still considerable uncertainty,” the analysts said in a research note. They also pointed to Iran’s denial of negotiations and warnings from Washington that additional action could be taken if no agreement is reached. Another point of contention involves the future status of the Strait of Hormuz. US officials have argued that an agreement reached in June required Iran to ensure unrestricted access to the shipping route, while Tehran insists that the deal preserved its authority over the waterway. Analysts at Barclays reported that exports of crude oil and refined petroleum products passing through the strait averaged 4.2 million barrels per day during the week ending July 31, compared with 3.2 million barrels per day a week earlier. Shipping Companies Adapt To Heightened Risks Shipping companies are also adapting to the heightened risks in the region. Recent shipping data showed that six Saudi-flagged supertankers altered their routes in the Gulf of Aden and chose longer journeys around southern Africa. At the same time, two tankers carrying Saudi crude oil successfully passed through the Bab el-Mandeb Strait. Although vessel traffic through the Strait of Hormuz and the Bab el-Mandeb Strait remained relatively stable at the beginning of the week, risks to shipping operations persist. Security concerns increased after the United Kingdom Maritime Trade Operations agency reported an incident involving a cargo vessel near Oman’s Al Khasab region. According to the report, the vessel informed authorities that it had been struck by an unidentified projectile. Market Analysts See Continued Volatility Market analysts believe that geopolitical developments will continue to influence oil prices in the coming weeks. Tim Waterer, chief market analyst at KCM Trade, said ongoing regional tensions have increased insurance costs, extended shipping times and forced some vessels to adopt alternative routes. He added that the security risks associated with the Strait of Hormuz and the Bab el-Mandeb Strait continue to support market prices by raising concerns about the stability of future energy supplies. As uncertainty continues to dominate the market, investors are expected to closely monitor diplomatic developments and shipping activity across some of the world’s most strategically important waterways.

Petrol Price on August 4 Reduced by Rs4.08 Per Litre
Pakistan

Petrol Price on August 4 Reduced by Rs4.08 Per Litre

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Government Cuts Petrol and Diesel Prices Under Revised Fuel Pricing Mechanism The federal government has reduced the price of petrol by Rs4.08 per litre and lowered the price of high-speed diesel (HSD) by Rs2.45 per litre, with the revised rates taking effect from August 4, 2026. According to a notification issued by the Ministry of Energy (Petroleum Division), the Oil and Gas Regulatory Authority (OGRA) revised the ex-depot prices of petroleum products under the government’s updated fuel pricing mechanism. New Petrol and Diesel Prices Effective August 4 Under the latest revision, the price of Motor Spirit (MS), commonly known as petrol, has been reduced from Rs336.03 per litre to Rs331.95 per litre. Meanwhile, the price of high-speed diesel (HSD) has been cut from Rs392.38 per litre to Rs389.93 per litre. The revised prices will remain in force until the next official review. Revised Fuel Prices Product Price on August 1 (Rs/litre) Price on August 4 (Rs/litre) Change Motor Spirit (MS) 336.03 331.95 -4.08 High-Speed Diesel (HSD) 392.38 389.93 -2.45 Second Fuel Price Reduction Within Days The latest announcement follows the previous fuel price revision on August 1, when the government reduced petrol prices by Re0.12 per litre and lowered high-speed diesel prices by Re0.66 per litre. The consecutive reductions reflect the government’s revised petroleum pricing mechanism, under which domestic fuel prices are adjusted more frequently in line with international oil prices, exchange rate movements and other pricing components. Lower Fuel Prices Expected to Ease Cost Pressures Petrol is primarily used by motorcycles, passenger cars and other light vehicles, making it the most widely consumed transportation fuel in Pakistan. High-speed diesel is mainly used by heavy transport vehicles, the agriculture sector and industries, meaning changes in HSD prices directly influence freight costs, agricultural operations and industrial production expenses. The latest reduction is expected to provide some relief to consumers and businesses by lowering transportation costs and helping ease inflationary pressures, although the overall impact will depend on future movements in global oil markets and the exchange rate.

Tax Relief For Vehicles Above Rs10m Raises Govt's Fiscal Priority Questions
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Tax Relief For Vehicles Above Rs10m Raises Govt’s Fiscal Priority Questions

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Government’s Proposed Hybrid Vehicle Tax Relief Sparks Debate At a time when Pakistan is implementing tough economic reforms under its IMF programme, the government’s reported move to reduce the sales tax on hybrid and plug-in hybrid vehicles from 25% to 18% raises a fundamental policy question: who really benefits? The proposal has triggered debate over whether limited fiscal space should be used to provide tax relief for high-value vehicles while the broader population continues to face inflation, higher taxes and reduced public spending. Policy Reversal Under Scrutiny The Finance Bill 2026 increased the sales tax on hybrid and plug-in hybrid vehicles to 25% as part of efforts to strengthen government revenues and meet fiscal commitments under the IMF programme. The government is now reportedly considering reversing that decision despite the IMF’s continued emphasis on broadening the tax base, reducing preferential tax treatment and maintaining fiscal discipline. The proposed policy shift has prompted questions about whether the government is sending mixed signals regarding its revenue strategy. Luxury Vehicle Segment Expected to Benefit The vehicles expected to benefit from the proposed tax reduction are largely priced above PKR 10 million, placing them beyond the reach of the vast majority of Pakistani consumers. For many observers, this creates the perception that ordinary citizens continue to bear the burden of higher taxes, inflation and economic adjustment, while tax relief is being considered for buyers of premium vehicles. Supporters of the proposal argue that reducing taxes on hybrid vehicles could accelerate the adoption of cleaner transportation technologies and help lower fuel consumption over the long term. While the environmental objective has merit, critics argue that the immediate beneficiaries would primarily be consumers purchasing luxury vehicles rather than the broader public. Fiscal Priorities Under the IMF Programme Pakistan remains under an IMF-supported reform programme that has required difficult fiscal measures, including higher taxation and reduced government spending. Every tax concession carries a fiscal cost at a time when the government continues to face significant revenue pressures. The central issue is not whether hybrid vehicles should be promoted, but whether scarce fiscal resources should be directed toward reducing taxes on vehicles costing more than PKR 10 million. Millions of Pakistanis continue to absorb the impact of economic reforms through rising living costs and tighter fiscal policies. Against that backdrop, selective tax relief for high-end vehicles has become a subject of public debate. Questions Over Government Priorities Governments are often judged not only by the taxes they impose but also by the sectors and groups they choose to support through tax relief. If the proposed reduction proceeds, the government will likely need to clearly explain how the policy aligns with its fiscal objectives, environmental goals and commitments under the IMF programme. The broader question remains whether the first beneficiaries of tax relief during a period of economic adjustment should be buyers of luxury hybrid vehicles or whether limited fiscal space could be directed toward measures with wider public impact.

Pakistan Excluded From New US Visa Bond Programme Requiring Deposits Of Up To $20,000
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Pakistan Excluded From New US Visa Bond Programme Requiring Deposits Of Up To $20,000

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Pakistan Not Included in New US Visa Bond Programme Pakistan has not been included in the new US visa bond programme, under which citizens from selected countries may be required to deposit as much as $20,000 before receiving a visitor visa. The policy officially came into effect on August 1 after the United States government decided to make the programme permanent following a review of the pilot scheme introduced in 2025. According to a list published in the US Federal Register, Pakistan is not among the 50 countries covered by the programme. In South Asia, Bangladesh and Nepal have been included, while India has been excluded from the new requirements. How the US Visa Bond Programme Works The US State Department said the US visa bond programme significantly reduced visa overstays and improved compliance with immigration regulations during the pilot phase. Officials reported that there were 45,488 visa overstays involving travellers from participating countries in 2024. However, fewer than 50 overstays were recorded during the first 10 months after the programme was introduced. Authorities also noted that the policy resulted in a decline in visa applications, as some individuals chose not to continue with the process after learning about the financial guarantee requirement. Diplomatic sources confirmed that Pakistani citizens will not be affected by the new rules. Who Will Be Required to Pay the Visa Bond? The programme applies to applicants seeking B-1 business visas and B-2 tourist visas from countries included in the scheme. Under the revised regulations, US consular officials may require applicants to provide a refundable financial guarantee ranging from $10,000 to $20,000 before issuing a visa. The State Department said the permanent framework replaces the temporary programme launched in 2025 while strengthening existing immigration enforcement measures. One of the most significant changes is the increase in the maximum bond amount from $15,000 to $20,000. Authorities have also removed the previous minimum bond requirement of $5,000 that existed under the pilot project. Countries Included in the Programme The programme covers 50 countries, including 30 African nations, along with several countries in Asia, the Caribbean and the Pacific Islands. Afghanistan and Iran have not been included because the United States does not maintain normal diplomatic relations with either country. The bond requirement will not automatically apply to every applicant. Instead, consular officers will assess each visa application individually and decide whether a financial guarantee is necessary before approving the visa. When Will the Bond Be Refunded? According to US officials, the full bond amount will be refunded if travellers comply with all visa conditions and leave the United States before their authorised stay expires. However, visitors who overstay their visas or violate immigration rules may forfeit the entire deposit. What Pakistan’s Exclusion Means for Travellers Pakistan’s exclusion from the US visa bond programme is expected to provide relief to thousands of Pakistanis who apply for business and tourist visas each year. While the decision means Pakistani applicants will not face the additional financial guarantee requirement, immigration experts continue to advise travellers to strictly follow all visa conditions and departure deadlines to avoid future complications with US immigration authorities.

SBP Fuel Card Payment Charges Cap Extended to Accelerate Raast QR Expansion
Pakistan

SBP Fuel Card Payment Charges Cap Extended to Accelerate Raast QR Expansion

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The SBP Fuel Card Payment Charges Cap has been extended until January 31, 2027, giving Pakistan’s banking and fuel retail sectors another six months to prepare for wider adoption of Raast QR-based digital payments. The decision reflects the State Bank of Pakistan’s continued efforts to reduce the cost of electronic transactions while encouraging fuel stations across the country to modernize their payment infrastructure. The latest circular, issued to banks, microfinance banks, electronic money institutions, payment system operators and payment service providers, directs all regulated entities to continue implementing the capped pricing mechanism for payment cards issued in Pakistan. While the move provides relief to consumers and fuel retailers by keeping transaction costs predictable, it also raises an important question: why does Pakistan still require repeated extensions for a digital payment initiative that has been under implementation for years? SBP Fuel Card Payment Charges Cap Remains Unchanged Under the extended policy, the SBP Fuel Card Payment Charges Cap will continue to apply to all card-present fuel purchases across Pakistan. The central bank has maintained the Merchant Discount Rate (MDR) at a maximum of Rs1.00 per litre for fuel purchases. Similarly, the Interchange Reimbursement Fee (IRF) will remain capped at Rs0.20 per litre for transactions involving fuel and related petroleum products. These limits apply to all payment cards issued within Pakistan and are intended to prevent excessive transaction costs from discouraging digital payments at petrol pumps. By maintaining lower processing charges, the SBP aims to make electronic payments commercially viable for fuel station operators while providing customers with greater convenience. Raast QR Expansion Remains the Main Objective A key objective behind extending the SBP Fuel Card Payment Charges Cap is to accelerate the nationwide rollout of interoperable Raast QR-based payment acceptance at fuel stations. The State Bank has instructed all regulated financial institutions to actively coordinate with fuel station merchants to ensure that Raast QR payment facilities become widely available during the extension period. Raast has emerged as Pakistan’s flagship instant payment system, enabling secure and real-time digital transactions. Expanding its presence at fuel stations is expected to reduce reliance on cash, improve transaction transparency and strengthen financial inclusion. However, widespread adoption depends not only on policy support but also on the willingness of fuel retailers to invest in digital infrastructure and staff training. A Necessary Extension or a Sign of Slow Progress? Although the extension provides continuity for businesses, it also highlights the slower-than-expected pace of Pakistan’s digital payment transformation. The State Bank first introduced these incentives to encourage digital acceptance at fuel stations. Yet another extension suggests that the desired level of Raast QR deployment has not been achieved. This raises concerns about implementation rather than policy design. Regulatory incentives can only succeed if banks, payment providers and fuel retailers actively invest in payment infrastructure, consumer awareness and operational readiness. Without stronger execution and measurable adoption targets, repeated policy extensions risk delaying the broader transition to a cashless economy. For Pakistan to realize the full benefits of digital payments, stakeholders must move beyond compliance and focus on creating a seamless customer experience that encourages everyday use. SBP to Review Policy in January 2027 The State Bank has confirmed that it will review the pricing framework on or around January 31, 2027, after assessing market response and the progress of Raast QR implementation. The revised instructions have taken immediate effect, while all other provisions of the earlier policy remain unchanged. The coming months will be critical in determining whether Pakistan’s fuel retail sector can finally achieve meaningful digital payment adoption or whether further extensions will become necessary. The extension of the SBP Fuel Card Payment Charges Cap offers stability for banks, payment service providers and fuel retailers while reinforcing Pakistan’s digital payment agenda. Lower transaction costs continue to support card-based fuel purchases, but the real measure of success will be the pace of Raast QR adoption across the country. If implementation remains slow despite continued regulatory support, policymakers may eventually need to address operational bottlenecks rather than relying solely on pricing incentives to drive digital transformation.

The Boardroom PK delivers trusted business news, analysis, and insights from Pakistan and beyond, keeping readers informed, inspired, and ahead in the evolving world of business and leadership.

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