While reopening of businesses following a drop in Covid-19 cases is encouraging, Pakistan’s economic recovery remains slow due to internal and external factors. The following challenges are likely to persist in the near-term:


High global energy prices, currency depreciation and supply chain disruptions are expected to continue applying upward pressure on the local prices of petrol, diesel, electricity, groceries, household related and other commonly used items and potentially cause shortages.

Interest Rates:

The current high interest rates are expected to remain elevated, causing downward pressure on demand. As a result, unnecessary debt-driven business expansion should be reassessed.

Urban Housing:

Federal policies for the construction sector coupled with significant devaluation of the Pakistani rupee have led to increases in both, house and land prices, making home-ownership difficult for many. There are indications that ‘inheritance tax’ and ‘estate tax’ on property and open plots will be introduced.

Currency & Equity Markets:

Recent events have led to high volatility in the stock markets and any investments in the equity and currency markets should be made with caution based on analysis and not speculation. The government has imposed a ban on the trade of cryptocurrency and investment into this ‘high risk’ asset class is strongly discouraged.

Digitisation & Documentation:

Digitisation has led to greater surveillance and businesses are encouraged to follow proper documentation in compliance with relevant laws that govern their sectors. Penalties and legal proceedings against non-tax filers is expected to increase and compliance with taxation requirements will become necessary for business expansion and growth.

It is advised that the following should be considered in the uncertain economic conditions:

1. Family-Based Financial Budgeting

  • Anticipate a sharp increase in core household expenses in the coming months, particularly grocery and utility bills. Carefully analyze unnecessary expenses that can be curtailed. Eliminate careless use of utilities, especially electrical appliances.
  • Shop for deals, discounts and promotions.
  • Study and explore possible investments in secure financial products such as insurance, marriage and retirement saving plans that are offered by credible financial institutions.

2. Increase Earning Capacity

  • Look towards ‘up-skilling’ through continuous learning in this changing world and aim to benefit from access to a wider canvas of virtual education platforms.
  • Encourage youth to explore the emerging market of virtual employment beyond geographical borders that provides an opportunity to earn through credible international employers and platforms.
  • Develop secondary earning opportunities within the family specially by encouraging the participation of women in the workforce to augment family income.
  • Consider certification in vocational traits if there is a gap in meaningful, formal education. Study the employment sectors and determine the skills that are in demand and offer growth trajectories.

3. Businesses

  • Ensure proper documentation in financial transactions and do not rely on verbal commitments and promises.
  • Refrain from investing in informal financial institutions and undocumented businesses owing to substantially increased default and credit risk.
  • Explore formation of alliances with like-minded business-owners for cost-reduction initiatives such as group-purchasing and bulk buying. Individuals forming such alliances are strongly advised to pre-define exit strategies at the outset to avoid situations that cause conflict.
  • Consider replacing traditional sources of energy with alternatives, i.e., solar power.
  • For individuals associated with farming, remain mindful of the increase in the cost of inputs and most importantly, consider steps to mitigate the impact of climate change.

In conclusion, the Council requests that caution is exercised in financial matters by reducing unnecessary spending and avoiding speculation in this uncertain economic climate. All decisions should be taken after careful analysis and investments should be made after completing all legal paperwork to minimize risk.

The Aga Khan Economic Planning Board Pakistan (EPB Pakistan) will continue to periodically conduct sessions on financial literacy, family-based budgeting and taxation. Individuals are encouraged to participate in these sessions within their respective jurisdictions. For employment opportunities, visit www.mansab.org.  In addition, EPB Pakistan is collaborating with the ‘American Continuing Education and Mentorship Academy (ACEM)’ for online certified courses on digital skills. Please visit www.acem.co for further details.