Pakistan Economic Survey 2025-26

Pakistan annually faces a recurring debate over sugarcane prices between farmers and sugar mills, with governments intervening to set prices. The article argues that the focus should shift from pricing to productivity, as structural challenges like stagnant farm productivity, rising costs, and resource scarcity hinder long-term competitiveness. Despite a 6.2% increase in sugarcane production last fiscal year, the crop contributes only 0.8% to GDP.

Pakistan's government reported a 3.37% decline in tax exemptions to Rs2.353 trillion in FY26, the first reduction in seven years, despite initial high figures and revisions. The decline follows seven consecutive years of increases and comes amid revenue shortfalls, with exemptions impacting federal-provincial revenue sharing.

The Economic Survey 2025-26 reveals missed economic targets and a freeze on provincial development programs, diverting over Rs900bn to the Centre’s strategic needs. Finance Minister Muhammad Aurangzeb highlighted resilience amid global trade challenges, floods, and regional conflicts, while announcing budget incentives for agriculture and housing.