Aurangzeb says budget to exhibit ‘bold initiatives’

ISLAMABAD: The federal government is preparing to introduce bold measures in the upcoming budget with a focus on strategic direction, Finance Minister Muhammad Aurangzeb said Monday.

While addressing an event organised by Karandaaz Pakistan and Pakistan Banks Association (PBA) here, the finance minister said that budget is not just about revenue and expenditure, it has to provide the strategic direction of where the economy is, and where it is heading.

He added that rather than making the math work, the government intends to make the budget document more strategic.

Govt to introduce ‘bold measures’ in the upcoming budget, says Aurangzeb

The federal budget for FY2025-26 will be presented on June 10, 2025.

Meanwhile, the Pakistan Economic Survey 2024-25 will be released on June 9, 2025.

Talking about the recent escalation of tensions between Pakistan and India, Aurangzeb said that these are very tense moments.

The entire nation has rightly celebrated the way our armed forces and political leadership have stood up against the aggression.

Aurangzeb shared that efforts were made to derail Pakistan’s engagement with the International Monetary Fund (IMF).

He said, there was no stone left unturned in terms of ensuring that the meeting with the IMF does not happen. If the meeting does happen, then these items are not on the agenda, whether it is the second tranche under the Extended Fund Facility (EFF) and the $1.3 billion under the Resilience and Sustainability Facility (RSF).

However, we are beyond that, and our case was discussed and decided on merit.

He said the unity shown by the nation against recent aggression is the same unity needed on the economic front.

On macroeconomic stability, Aurangzeb emphasised the need to avoid repeating past mistakes.

He said that we have achieved macroeconomic stability in yesteryears and in the previous decades as well, but we have squandered the opportunity.

Because it is easy to get into a sugar rush, i.e. pump liquidity into the market, go for consumption-led growth, which triggers balance of payment and FX issues.

He said that to break away from the boom and bust cycle, Pakistan needs to stay the course in terms of structural reforms.

Aurangzeb shared that the government remains committed to simplifying the tax return filing process for the salaried class. “70-80 per cent of the salaried class do not necessarily hold equity or income portfolios, why should they fill 140-150 measures?

“We are trying to bring it down to nine items, five on the wealth and four on the income tax side.”

He said the government wants to implement the simplified process by the end of September.

On the SoE reforms, the finance minister admitted that this is one area where we did not do well last year.

He said that the government remains committed to accelerating reforms in this sector.

He confirmed the PIA transaction has been relaunched and expressed optimism about its completion. On debt servicing, Aurangzeb said in the ongoing fiscal the government debt servicing cost has decreased by Rs1 trillion. “Next year, we are going to restructure/reorganize our debt management office along the modern lines,” he said.

The finance minister was of the view that the ongoing structural reforms would put Pakistan’s economy “on a path of sustainable growth”.

Aurangzeb expressed optimism about Pakistan’s long-term economic trajectory.

Our economy has crossed the $400 billion level. This shows we are moving in the right direction but to become a $3 trillion economy by 2047, we need to mitigate two existential issues, i.e. population and climate.

He said four out of the six points under the 10-year Country Partnership Framework inked with the World Bank deal with climate and population.

Speaking about the importance of the initiative, Syed Salim Raza, chairperson Karandaaz, said: “Karandaaz is proud to support Pakistan’s financial sector as it transitions toward purpose-driven finance. This training is part of our broader commitment to building the institutional capacity required to align with global investment standards and deliver measurable development outcomes. By strengthening local capabilities in impact measurement and sustainable finance, we are laying the foundation for a more inclusive and resilient financial system.”

Addressing the participants, Director Development BHC Islamabad Jo Moir stated, “This training underscores BHC’s long-term engagement with Pakistan’s financial sector. A decade ago, we supported the creation of Karandaaz as a special purpose impact finance vehicle. Today, it serves as a lighthouse for the sector, demonstrating scalable models for inclusive and sustainable finance.”

The workshop is being led by Alex MacGillivray, executive director at the JIM Foundation and a globally recognised expert in impact measurement. With a career spanning development finance institutions and advisory work international impact investors, MacGillivray has delivered a highly practical curriculum that blended theory with real-world applications.

“The idea was to move beyond traditional credit models and introduce a more purposeful financing approach, one that drives measurable outcomes alongside financial returns,” said MacGillivray. “With the right institutional momentum and leadership, Pakistan can play a key role in the global impact investing movement.”

The training is covering a comprehensive range of topics, including strategic intent, impact governance, portfolio-level impact design, impact at exit and independent validation. Participants are engaging in interactive case studies, peer learning sessions, and scenario-based exercises aimed at translating concepts into actionable strategies.

Articulating the sector’s commitment to sustainable finance, Muneer Kamal, CEO and Secretary General PBA, said, “Pakistan’s banking sector must lead from the front as we transition towards a more sustainable and impact-driven financial ecosystem. This partnership with MoF and Karandaaz reflects PBA’s commitment to strengthening sectoral readiness and aligning capital with long-term national priorities.”

This training reinforces the commitment by MoF, Karandaaz and PBA’s ongoing efforts to strengthen institutional capabilities in Pakistan’s financial sector and support the country’s transition toward sustainable, impact-oriented finance. As global standards for responsible investing continue to evolve, Karandaaz remains committed to equipping local actors with the tools and knowledge needed to access and manage development capital effectively.

Copyright Business Recorder, 2025