Dr. Miftah Ismail, former Federal Minister of Pakistan, delivered a compelling talk on "Pakistan’s Economic Outlook: Challenges and Opportunities" to students and faculty at the Institute of Business Management (IoBM) in Karachi on Tuesday, February 4, 2025. In a dynamic conversation with Dr. Muhammad Ali Faisal, Assistant Professor at IoBM, Dr. Ismail discussed key challenges facing Pakistan's economy and proposed actionable solutions for the future.
Dr. Ismail opened the session by emphasizing the necessity of disrupting the existing system to stimulate growth and progress in Pakistan. He highlighted the Gross Domestic Product (GDP) as the most significant indicator of economic growth, while stressing that inflation has exacerbated the economic divide, widening the gap between the rich and poor. He further pointed out that rising tax rates and inflation are putting increasing pressure on the disposable income of Pakistanis.
Dr. Ismail underscored the importance of setting clear priorities to achieve long-term economic success. He advocated for the salaried class to contribute a larger share of taxes and questioned why agricultural land remains untaxed despite its vital role in the national economy. He elaborated on the principles of tax equity, explaining the need for both horizontal and vertical equity, ensuring that individuals pay taxes in proportion to their income levels. The former minister also emphasized the need for substantial investment in the agricultural sector, highlighting the necessity to empower farmers, invest in modern harvesters, and promote crop insurance. Dr. Ismail called for a deeper understanding of farm economics, urging stakeholders to "think like a farmer" to drive growth and improve productivity in this critical sector.
Dr. Ismail also addressed the challenges related to foreign investment in Pakistan, noting that most foreign investment is directed toward companies focused on selling products or services. He criticized the flow of Foreign Direct Investment (FDI) through informal channels like Hawala, rather than fostering industries that could help Pakistan manufacture goods and boost exports.
He called on local investors to take an active role in Pakistan’s economic development and highlighted the failure of the governance system, which has exacerbated socio-economic issues in the country. Dr. Ismail pointed out that Pakistan has the highest number of out-of-school children in the world, with over 26 million children lacking access to education. Dr. Ismail also discussed the stark class divisions in Pakistan, stating that the elite class, which constitutes only 1% of the population, controls significant power in the country. Meanwhile, the middle class, comprising 9-10% of the population, primarily works in various industries. The remaining 90% of the population struggles with insufficient resources and opportunities.
When asked about his vision for Pakistan’s future, Dr. Ismail shared his plans if he were to become Prime Minister. He proposed working four key areas: maintaining law and order, providing education, enhancing healthcare, and providing civic services. Despite having a budget of Rs. 12,000 billion, the provinces are still struggling to deliver these essential services. Dr. Ismail suggested overhauling the National Finance Commission (NFC) system, decentralizing authority, and empowering local governments. He also proposed the introduction of private school vouchers to enhance access to quality education and clarified that while the government would set educational standards, it would leave the syllabus to be determined by schools, promoting flexibility and adaptability in the education system. Dr. Miftah Ismail’s insightful address resonated deeply with the audience, highlighting the urgent need for systemic reforms to foster sustainable economic progress in Pakistan.
As a gesture of gratitude, Dr. Miftah Ismail was presented with a token of appreciation by Prof. Dr. Tariq Rahim Soomro, Rector of IoBM. He was joined by Prof. Dr. Muhammad Kashif, Dean of the College of Business Management (CBM), and Prof. Dr. Muhammad Abbas, Dean of the College of Computer Science and Information Systems (CCSIS).