Every year, when the budget comes around, we end up having the same argument. We talk about taxes, deficits, shortfalls and targets. What we do not talk about enough is what all of this is supposed to achieve.
A country does not collect taxes just to keep the lights on. It collects taxes to build capacity - in its people, its institutions, its infrastructure, its farms, its industries and its future. In Pakistan, too much of that money is absorbed by the day-to-day cost of running the state, and too little goes into the things that would make the economy stronger five or ten years from now.
You can see this clearly in agriculture. Cotton production, once one of the anchors of the economy, has fallen sharply over the last decade, from nearly 15 million bales in 2011-12 to around 5.3 million in recent years. Wheat productivity is still under strain. Value-added agriculture remains a relatively small part of our export mix, even though other countries in the region have done far more to move up that chain.
Then there is the population question, which should worry us more than it seems to. Around two-thirds of Pakistanis are under thirty. People like to describe that as an advantage, and in theory it is. But a young population does not automatically become economic strength. It only does so when there is serious investment in education, skills and jobs. Without that, the demographic dividend becomes just another phrase we repeat to comfort ourselves.
These are the basics of long-term growth. Yet we continue to lean on the same parts of the economy again and again, especially the documented and compliant sectors that are already carrying more than their share.
I have seen this first-hand in the food and beverage industry. Formal, tax-paying manufacturers are expected to meet standards, comply with rules and absorb rising costs, while a large informal and grey-market segment continues with far less scrutiny. On top of that, businesses often have to navigate overlapping or inconsistent requirements between federal and provincial food authorities. The unintended message is difficult to ignore: visible, documented and compliant businesses often end up carrying a heavier burden.
That is not a recipe for growth. It gradually weakens the very sectors that create jobs, invest in systems, build brands and generate exports. No serious economy can keep squeezing its formal sector and expect stronger results.
The corporate sector should not be seen only as a source of revenue. Strong companies hire people, train them, improve processes, invest in technology and, when conditions allow, compete beyond the domestic market. When policy treats such businesses mainly as tax handles, investment slows and ambition narrows.
Pakistan is not short of assets. We have agricultural depth, a large domestic market, entrepreneurial drive and a diaspora that brings capital, experience and international access. What we have lacked is consistency in policy and seriousness in execution. These advantages only matter when they are converted into productivity, exports and jobs.
Other countries have shown what a more disciplined path can look like. Turkey and Malaysia, for example, did not move toward value-added production by accident. They invested in capability, improved standards, built credibility and then expanded. Pakistan has never fully committed itself to that sequence.
Some of the fixes are not even mysterious. Better coordination between federal and provincial food authorities would reduce unnecessary compliance costs for responsible businesses. Export facilitation measures that once helped Pakistani producers compete more fairly with regional players should be strengthened, not chipped away. Cold-chain infrastructure, better seed technology and stronger food processing capacity all need steady investment if agriculture is to generate higher-value output. Technical and vocational training also needs a reset. It should be built around the needs of industry, with employers helping shape what is taught, rather than being designed in isolation and then handed to the market.
At some point, we have to decide what kind of economy we are trying to build. One that keeps extracting from the few sectors that are visible and organised, or one that helps those sectors expand, compete and employ more people?
Entrepreneurs matter here more than we often admit. They take risks, put their own capital to work and build businesses in an environment that is rarely easy. If they are treated mainly as a tax base, the country will get fewer of them, not more. If they are treated as partners in development, the economy has a better chance of growing in a durable way.
Pakistan’s problem is not only that it needs more revenue. The deeper problem is that it has not invested enough in productivity. That is why our budget debates often feel incomplete. We argue over what to tax, but spend far less time on the productive capacity those taxes are meant to create.
That is the real question before us. Not just what Pakistan owes us, but what we are willing to create here - and whether this time we are serious about it.
Copyright Business Recorder, 2026
The writer is the Chief Operating Officer at a leading biscuit manufacturing company and leads the company’s export-driven growth.