Islamic finance promotes fairness, transparency, and risk-sharing, fostering economic growth and financial inclusion in Pakistan. Pakistan’s Islamic banking sector, valued at Rs 6.3 trillion, is expanding with regulatory frameworks and government initiatives Islamic finance is a financial system that operates in accordance with Shariah principles, emphasizing fairness, transparency, and ethical financial practices. The principles of Islamic finance are based on Shariah compliance, risk sharing, fairness, and transparency. It prohibits interest-based transactions collection and payment of interest (riba), and instead promotes risk-sharing mechanisms such as profit-and-loss sharing agreements. The sector has seen significant global growth, driven by increasing demand for Shariah-compliant…
Author: Ayaz Ali Kolachi
Business-driven CSR initiatives foster economic empowerment, proving companies can be key players in poverty reduction The world has come a long distance from the days of dark poverty. World over, many initiatives are being undertaken to rid communities of the scourge of poverty. One such is CSR (Corporate Social Responsibility), which can work wonders and has in many instances in the recent past. The best illustration of the concept can be done as follows: Imagine a village surrounded by a barren land, where the villagers struggle to find clean water and food. A nearby factory, owned by a socially responsible…
Govt support and farmer education can overcome challenges, fostering organic farming’s growth The world is transitioning to organic farming for a variety of reasons. The biggest of them are health concerns that accompany synthetic fertilisers that are used to grow crops. Organic farming employs natural farming methods to control pests, resulting in food with a high nutritional value and a lower level of pesticide residues. Pakistan’s agricultural sector stands as the linchpin of its economy, accounting for a substantial 20.9% of the GDP and employing approximately 42.3% of the labour force. The country’s fertile plains, bolstered by the Indus Basin…
Pakistan’s fight against socioeconomic challenges continues with hopeful successes and lingering struggles The year 2024 wasn’t much different in Pakistan’s books, as the country continued to wrestle with the same monsters, with veritable success in some areas, while there are still multiple fronts where the war needs to be fought to dismantle and uproot these socioeconomic irritants forever. As the erstwhile tumultuous year of 2024 succumbed to the inevitability of time, Pakistan stood at the cusp of a nascent era, poised to navigate the complexities of the global economy. The geo-political landscape, a veritable tapestry woven from the threads of…
Revamping curricula and prioritising inclusivity can unlock Pakistan’s educational potential and empower future generations Another year is drawing to an end, but it seems Pakistan’s educational woes are there to stay festering for yet another year or probably for many more years to come. There’s hardly any speck of doubt in the fact that education is the latest and the most cutting edge weapon that vouches for the rise and fall of nations. The rise of China as a new hub of civilisation in all walks of life is a testament that a country can lift itself out of darkness…
Projected to reach Rs40 billion by 2025, e-commerce is Pakistan’s new frontier for economic growth Digitalisation brings unprecedented income growth for women, with earnings nearly nine times the national average Pakistan is undergoing a digital transformation like the rest of the world, owing to the emergence of cutting-edge technologies that have made digital strides possible within the country and beyond. This transformation in recent years, is driven by the government’s visionary Digital Pakistan initiative, launched in 2019 (Digital Pakistan Policy, 2019). This comprehensive strategy aims to employ technology for economic growth, improved governance, and enhanced citizen engagement. As of 2024,…
The corridor elevates Pakistan’s strategic location, linking East and West through expanded ports, highways, and railways. CPEC projects revitalise Pakistan’s infrastructure, enhancing connectivity, boosting jobs, and increasing GDP by 2.5pc annually The China-Pakistan Economic Corridor (CPEC), a pivotal component of China’s Belt and Road Initiative (BRI), has profoundly transformed Pakistan’s infrastructure landscape. From Pakistan’s perspective, CPEC has ushered in a new era of swift connectivity, which would have been considered nothing more than a conjecture before it took root in 2015. CPEC, the majestic corridor of commerce, has awakened Pakistan from its infrastructural slumber, altering the very fabric of our…
Pakistan, right after its inception in 1947, embarked on an oil and gas exploration journey, as it had inherited a negligible oil and gas infrastructure from the British. The journey was arduous, but slowly and gradually the efforts bore a productive yield, when the hunt for energy resources started to pay huge dividends. Initially, exploration efforts in 1950s focused on the Potwar Plateau and Indus Valley, leading to the first oil discovery at Dhullian (1952) and first gas discovery at Khaur (1956). Significant discoveries followed in the 1960s, including the Rawalpindi-Kallar Kahar gas field. The 1970s saw offshore drilling commence…
Pakistan’s banking sector needs urgent overhauling; can tackle high NPLs and enhance financial inclusion Adopting Singapore’s liquidity framework and Canada’s risk management can boost Pakistan’s banking resilience and inclusivity The banking sector in any country is its spine, allowing it the needed financial mobility and resilience to cope with challenges of all kinds. It’s the epicenter of the country’s upward and downward financial mobility. In addition to it, a robust banking system is the sign of a thronging financial vista,where the circulation of money in different sectors demonstrates people’s trust in their financial management system that keeps countries breathing in…
Unpredictable weather patterns and rising temperatures threaten crop yields and water resources Adopting methods like Zero Budget Natural Farming and Agroecology could improve resilience and productivity Pakistan’s economic sector, which heavily banks upon agriculture is in the eye of a serious storm related to changing environmental patterns, which threaten to disrupt the normalcy of the agricultural produce. The erratic changes in weather patterns will give birth to multifaceted challenges, which Pakistan may find impossible to withstand, considering that our resources wouldn’t conventionally allow us to diversify quickly enough to defeat this leviathan of global warming. The signs of the meltdown…
Investments in education and entrepreneurship can capitalise on youth, contrasted with the risks of neglect and poor job placements Pakistan is blessed with many riches, but having over 60 percent of its population, forming a youth bulge in itself is an opulence, provided it’s judiciously used. Unfortunately, Pakistan finds itself ensnared in a political and economic labyrinth over and over again. The country’s political leadership is immersed in its short-sighted power struggles, which has compromised utilising Pakistan’s best asset — the youth in its right place. Pakistan’s demographic landscape is characterised by a youthful population, with over 67 percent of…
Pakistan is mired in a heated debate on privatisation that’s underway It isn’t going to produce the desired yield, as people generally tend to look at it as a double-edged sword: they know, the government isn’t doing enough and they fully know that privatisation isn’t the panacea they were looking for. People’s trust in private hands taking charge in different sectors is also diminished by basket cases like PTCL, KESC and Pakistan Steel Mills (PSM), which didn’t happen after the deal was done. Another worst case is that of ‘Take or Pay’ contracts between Government of Pakistan and IPPs (Independent…
Need to prioritise sustainable energy solutions, take strategic reforms for long-term growth and stability Some considerations and potential steps county’s could take to address its energy crisis The concept of energy security was introduced in the early 2000s to cater to the needs of a dynamic, industrial world that required uninterrupted power supply, and a secure energy paradigm to be able to flourish and some of the key components involved in the theory are diversification of energy resources; improving energy efficiency; enhancing energy infrastructure and promotion of energy conservation. However, none of these policy prongs seemed to have engaged Pakistan’s…
A common man’s perspective on the budget for the fiscal year 2024-25 The budget speech delivered by the Federal Minister for Finance and Revenue, Muhammad Aurangzeb, was received with cautious optimism and a perennial sense of pessimism among the concerned quarters. An overall view of the budget reveals that the message conveyed is simple: Not much is going to change this year either. The total outlay of the budget is a significant Rs18.9 trillion. Tax revenues placed at Rs7.2 trillion do not inspire confidence. A fiscal deficit of Rs1.8 trillion means that many sectors, including health and education, will remain…
Need to address fundamental issues in GDP, inflation and structural reforms in fixing Pakistan’s economic woes The economic challenges that Pakistan has to contend with are part of simple economic theories. There is nothing quixotic or cryptic to them. The country looks trapped in an eternal economic spin. At least that’s what the figures loudly say. Additionally, they are interconnected with fundamental management of the economy, which have been badly messed up in Pakistan. Former prime minister Shahid Khan Abbasi recently spotlighted yawning flaws in our economic approach noting that “approaching the IMF to get a bailout package is in…