Chairman Businessmen Group (BMG) Zubair Motiwala, while describing the outgoing year 2025 as one of the most challenging and turbulent periods for Pakistan’s economy and business community, stated that the year will be remembered for its deep-rooted challenges, policy uncertainty, and sustained pressure on productive sectors that form the backbone of national economic activity. He said that while the country remained trapped in economic firefighting throughout the year, trade and industry paid the heaviest price amid shrinking margins, rising costs, and an increasingly hostile operating environment.

Zubair Motiwala, while referring to the Pakistan-India Conflict in May 2025, stated that Indian aggression during the year was handled decisively and responsibly under the leadership of Field Marshal Syed Asim Munir, reflecting national unity, institutional harmony, and collective resolve. He noted that the prompt and effective response prevented the situation from turning into a prolonged conflict, protected economic stability, and compelled the adversary to retreat, thereby safeguarding national interests and business confidence.

Chairman, while acknowledging the severe challenges faced by businesses during 2025, stated that the year was not entirely devoid of positive developments at the macroeconomic level and certain stabilizing trends did emerge. He pointed out that the most significant relief came in the form of a sharp reduction in the policy interest rate, which was brought down from an exceptionally high level of 23 percent to around 10.5 percent during 2025, providing much-needed breathing space to borrowers and easing debt-servicing pressures. He noted that several macroeconomic indicators showed visible improvement during the year, including relative stability in the dollar-rupee parity, better management of the current account deficit and trade account deficit, improvement in foreign exchange reserves, and a noticeable revival in the stock market, which reflected improved sentiment among portfolio investors and greater confidence in macroeconomic stabilization efforts.

However, Zubair Motiwala emphasized that despite these macro-level improvements, microeconomic indicators continued to paint a troubling picture throughout 2025, leaving the real economy and productive sectors under immense stress. He explained that conditions at the ground level remained largely unchanged, with local industries struggling under high energy costs, excessive taxation, regulatory pressures, and weak demand. Exports, instead of gaining momentum from macro stability, largely remained stagnant or showed signs of decline, highlighting deep structural inefficiencies and cost disadvantages faced by Pakistani exporters. According to Motiwala, this disconnect between improving macro indicators and deteriorating micro realities clearly demonstrates the urgent need to address structural constraints through liberalization of policies, rationalization of taxes, and creation of a truly enabling environment so that macro stability can finally translate into industrial growth, export expansion, and sustainable economic recovery.

Commenting on the federal budget for 2025, Chairman BMG stated that the document proved to be deeply disappointing for trade and industry as it introduced a range of anti-business measures that placed additional burdens on already struggling enterprises. He said that rather than offering meaningful tax relief or incentives for expansion, exports, and job creation, the budget leaned heavily on increased taxation, withdrawal of concessions, and new levies, which collectively dampened industrial momentum and weakened Pakistan’s competitiveness at a time when regional economies were actively facilitating businesses.

Amid this otherwise bleak economic landscape, Chairman BMG acknowledged that the privatization of Pakistan International Airlines (PIA) towards the end of the year emerged as a rare and significant positive development. He said that the successful conclusion of this long-pending transaction sent a much-needed signal that difficult but necessary reforms are possible when political will aligns with economic logic. While cautioning that a single privatization cannot resolve systemic issues, he described the PIA transaction as a “light at the end of the tunnel” and a potential starting point for broader structural reform.

Turning to the outlook for 2026, Zubair Motiwala stressed that the new year must mark a decisive break from the policy approach of coercion, excessive enforcement, and fear-based compliance. He categorically stated that raids, arrests, and punitive actions against businesses have historically failed to deliver sustainable revenue gains and have instead resulted in capital flight, informalization of the economy, and erosion of investor trust. He warned that no local or foreign investor will commit capital in an environment dominated by unpredictability and coercive regulation.

He underscored that Pakistan urgently needs to adopt a policy framework centered on liberalization, facilitation, and partnership with the private sector. According to him, economic revival cannot be achieved through force but through trust, transparency, and incentives that encourage businesses to expand operations, invest in technology, and generate employment. He maintained that countries competing with Pakistan for investment are offering stability, policy continuity, and cost competitiveness, while Pakistan risks pricing itself out of global value chains.

Chairman BMG also called for immediate rationalization of the regulatory landscape in 2026, noting that businesses in Pakistan are monitored by an excessive number of federal, provincial, and local agencies, often with overlapping mandates and conflicting requirements. He said that this multiplicity of regulators not only increases compliance costs but also creates opportunities for harassment. Reducing the number of monitoring agencies and introducing a coordinated, risk-based regulatory framework is essential to improving ease of doing business.

Highlighting the most pressing issue confronting industry, Zubair Motiwala stated that unbearably high electricity and gas tariffs have become the single largest factor behind the closure of industries across Pakistan. He said that energy prices in Pakistan are completely misaligned with those prevailing in competing economies, making locally manufactured goods uncompetitive both domestically and internationally. He warned that unless energy tariffs are brought to regionally competitive levels, further deindustrialization is inevitable.

He further pointed out that the minimum wage in Pakistan has risen sharply in recent years without corresponding gains in productivity, creating additional stress for labor-intensive industries. While acknowledging the importance of protecting workers, he emphasized that wage policies must be realistic, gradual, and aligned with economic capacity, otherwise they risk accelerating layoffs and factory closures rather than improving livelihoods.

Zubair Motiwala also criticized the proliferation of taxes and levies that continue to stifle industrial expansion, specifically mentioning the 1.8 percent cess on imports, along with a range of additional duties, withholding taxes, and sector-specific charges. He said that these taxes cumulatively raise the cost of raw materials and machinery, discourage modernization, and reduce the incentive for value addition. He stressed that rationalization of the tax regime is essential if Pakistan aims to revive industrial growth and expand its export base.

Expressing frustration over governance practices, Chairman BMG observed that whenever serious economic challenges emerge, the government’s default response is to constitute committees whose recommendations often remain unimplemented. “I request the Prime Minister to constitute focused, time-bound committees on specific economic challenges, including reduction of electricity and gas bills, rationalization of the excessive number of regulatory agencies, adoption of technical solutions to curb tax theft, and replacement of coercive field operations by consultative and technology-driven mechanisms”, he advised while emphasizing that such targeted interventions would yield sustainable results, restore trust, and help create an enabling environment for businesses and investment.

Zubair Motiwala strongly advocated for assigning meaningful and result-oriented roles to Chambers of Commerce and trade associations, which possess ground-level knowledge, sectoral expertise, and practical insights into economic realities. He said that these bodies should be formally tasked with preparing comprehensive, actionable policy proposals aimed at resolving economic challenges, enhancing revenue through growth, and promoting sustainable industrialization.

In this context, he stated that the Karachi Chamber of Commerce & Industry (KCCI) already maintains a dedicated research cell that is actively engaged in compiling detailed budget proposals for the federal budget 2026. He reiterated that KCCI stands fully prepared to undertake any assignment given by the government in a rational, data-driven, and constructive manner, aimed at achieving shared national objectives.