In a stark admission, Pakistan’s Finance Minister has confirmed what many suspected: elevated taxation and prohibitive energy rates are prompting a corporate exodus. Aurangzeb’s comments spotlight the perfect storm battering the country’s industrial backbone.
Heavyweights such as Siemens and Johnson & Johnson have curtailed presence, unable to stomach power tariffs up 70% and taxes that eclipse regional peers. Daily outages averaging 8 hours in industrial belts compound the pain, halting assembly lines and inflating logistics costs.
The minister quantified the damage—FDI halved to under $1 billion, with manufacturing output contracting 12%. He attributed this to legacy issues like over-reliance on furnace oil and a tax system riddled with exemptions for the elite, leaving corporates overburdened.
Government strategies include solar incentives and digital tax collection to plug leakages, but analysts call for bolder moves like unbundling DISCOs and currency stabilization. As competitors lure firms with ease-of-doing-business rankings, Pakistan’s slide continues. Revitalization demands political will to prioritize reforms over short-term fixes, ensuring a sustainable path forward.