UBG urges govt to incorporate fiscal austerity into economic policy

KARACHI: President of the United Business Group (UBG) Zubair Tufail has urged the federal and provincial governments to adopt fiscal austerity as a permanent element of national economic policy in order to address mounting financial pressures, the growing debt burden, and widening budget deficits.

He said Pakistan is currently struggling under the weight of substantial domestic and external debt, and without meaningful reductions in government expenditures, achieving long-term economic stability will remain an uphill task.

According to him, a development model based primarily on borrowing is unsustainable, making prudent and efficient utilization of public resources imperative.

Zubair Tufail noted that excessive government spending on administrative expenses, protocol culture, unproductive subsidies, and loss-making state-owned enterprises has placed an enormous burden on the national exchequer.

He recommended that all ministries, government departments, and public sector organisations undergo a comprehensive expenditure review to identify and eliminate non-essential spending that does not directly contribute to public welfare or economic growth.

The resources saved through such measures, he said, should be redirected towards education, healthcare, infrastructure development, export promotion, and improvements in the energy sector.

The UBG President emphasised that the private sector can play a pivotal role in driving economic growth, provided the government creates a business-friendly environment through affordable energy, a simplified tax regime, and investment-friendly policies.

He pointed out that high interest rates, expensive electricity, and a complex taxation system have significantly increased the cost of doing business and weakened the competitiveness of industries and exporters. He maintained that fiscal discipline, coupled with comprehensive economic reforms, would not only encourage domestic and foreign investment but also generate new employment opportunities across the country.

Zubair Tufail further stated that lasting economic stability cannot be achieved without fiscal discipline, transparency, and accountability. He called on the government to reduce reliance on borrowing by expanding the tax base, boosting exports, reforming state-owned enterprises, and substantially cutting non-development expenditures. He stressed that strengthening Pakistan’s economy requires a coordinated strategy involving the government, the business community, and all relevant stakeholders. Such collective efforts, he said, would pave the way for sustainable economic growth, greater self-reliance, and long-term prosperity for the country.

Copyright Business Recorder, 2026