Author: Ibraheem Sohail

Popular social media platforms claimed that the world’s largest cryptocurrency exchange, Binance, was planning to establish its Asian head office in Pakistan. However, sources within the Pakistan Crypto Council (PCC) confirmed to The Current that this information was baseless and the underlying claims were false.

While sources from the PCC have dubbed the claims as misinformation, Binance has not yet issued an official statement to distance itself from these claims.

These claims, made on Tuesday, 10 June, were spread out by two accounts on X (formerly Twitter): ‘South Asia Index’ and ‘Defence Index’. Analytics indicate that these posts were viewed by 186,400 accounts and garnered 7,400 likes.

Netizens, unaware that the claims were false, outlined the potential benefits for Pakistan.

“Pakistan will be the center of crypto market in Asia” one user wrote in the comments.

Another social media user commented, “Its need of hour and Pakistan is winning it. More power to Pakistan.”.

It merits a mention that Binance’s co-founder, Changpeng Zhao (CZ), recently joined the PCC, lending weight to the false claims, as some believed he played a role in bringing Binance’s headquarters to Pakistan. However, while the aforementioned claims have been identified by The Current to be false, Pakistan has been making great strides to adopt, regulate, and integrate digital assets into the country’s economic landscape.

Some of these developments include the unveiling of Pakistan’s first-ever government-led Strategic Bitcoin Reserve at Bitcoin Vegas 2025 in Las Vegas, United States. Moreover, the PCC’s Chief Executive Officer (CEO), Bilal Bin Saqib, urged crypto builders in his keynote speech at Bitcoin Vegas 2025 to tokenise land and “build wallets for the unbanked”. 

If builders heed his advice, Pakistan could witness a sizable influx of foreign direct investment (FDI), to the tune of billions of dollars, along with a potential increase in employment opportunities. To facilitate the inflow of crypto-related investments, authorities reportedly greenlighted the allocation of 2,000 megawatts (MW) of power to these initiatives.

Data from reports suggests that the government intended to provide crypto miners with electricity at eight to nine rupees per unit. For reference, the base rate stands at a significantly higher Rs24 to Rs25 per unit, showcasing the magnitude of savings bitcoin miners would have enjoyed. However, the International Monetary Fund (IMF) has expressed displeasure over the provision of surplus power at uneven rates to different segments of Pakistani society.

 
The IMF’s stance on the provision of surplus power at lower rates has led analysts to question whether the government will still honour their announcement to allocate 2000MW of power to crypto mining and AI data centres.

Finance Minister Muhammad Aurangzeb formally presented the federal budget for fiscal year 2025–26 in a much anticipated session on Tuesday, setting the outlay at Rs17.573 trillion. According to reports, the announcement was made during a National Assembly session presided by Speaker Ayaz Sadiq, which commenced late in the afternoon.

Aurangzeb laid Finance Bill 2025 before the House along with detailed revenue and budgetary documents. Government expenditure for the incoming fiscal year (FY) 2025-26 stands lower than last FY’s outlay of Rs18.78 trillion. Details from reports suggest that the Federal Board of revenue is responsible for revenue collections amounting to a staggering Rs14.131 trillion. 

The new revenue target is being dubbed as ambitious as the revised revenue target for the outgoing FY stands at just Rs12.33 trillion. However, key officials have conceded that the FBR may remain unable to meet the revised target before the start of FY 2025-26. 

Government pay and pensions have witnessed a hike of 10 percent. Prior to the release of the budget, the Ministry of Finance (MoF) tabled four proposals on pay and pension hikes which ranged from five to 12.5 percent.

Initial reports suggest that the final decision was likely to lean toward a raise between 7.5 to 10 percent for government employees, with a 30 percent Disparity Allowance expected for those in grades 1 to 16. The hike in pay and pensions is in line with the higher end of the projections.

Analysts have outlined how the hike in salaries is higher than the rate of inflation in the economy. Inflation rates have remained subdued, largely because of the State Bank of Pakistan’s goal to rein in inflation.

The overall revenue framework sees the FBR’s Rs14.131 trillion goal supported by a projected non-tax revenue collection of Rs5.147 trillion.
Mark-up payments on debt obligations remain a dominant portion of federal spending as they have been budgeted at Rs8.207 trillion. This marks a steep decline from Rs9.7 trillion the year before. Defence allocations have increased by 18 percent, standing at Rs2.55 trillion. Analysts believe one factor behind the hike is India’s unwarranted belligerence against Pakistan. 

Pension payments for FY 2025-26 will stand at Rs1.05 trillion. Subsidies and grants have been pitched at Rs1.186 trillion and Rs1.9 trillion respectively.

On the development side, the federal Public Sector Development Programme (PSDP) has been slashed, standing at just Rs1 trillion. Total federal expenditures for the fiscal year have been pegged at Rs17.573 trillion, of which Rs16.286 trillion constitutes current spending.

It merits a mention that the federal government intended to announce the budget earlier, however authorities chose to delay the announcement instead as discussions, in late May, between Islamabad and the IMF remained inconclusive.

Users of the national grid are once again under financial strain, with Pakistan’s excess power capacity resulting in idle power plants continuing to receive capacity payments. According to the latest Economic Survey, Pakistan’s total power generation capacity could increase to a staggering 46,605 megawatts (MW) by the end of fiscal year (FY) 2024-25.

Data from reports indicate that the current capacity payment burden stands at an extortionate Rs12 to Rs15 per unit. Energy experts, however, believe that the strain of capacity payments is likely to decline in the coming years as the federal government has ended multiple power purchase agreements (PPAs) with independent power producers (IPPs). The burden may decline further as Islamabad has stopped new power-related projects.

Details from reports suggest that the financial strain of capacity payments increases during winter months as electricity demand plummets to as low as 12,000 MW. However, users of the national grid cannot use up excess power even in the summer months.

During the first nine months of FY 2024-25, power consumption remained at 80,111 GWh, whereas electricity generation dwarfed consumption, standing at 90,145 GWh. The breakup of power consumption reveals that households, industries, commercial users and the agriculture sector use up 49.6 percent, 26.3 percent, 8.6 percent and 5.7 percent, respectively.

As per estimates, the national grid pays capacity charges up to 2,000MW in the summer, with the burden increasing in winter as users are then responsible for capacity charges for 5,000MW. Reports have outlined that terminating additional PPAs could alleviate the financial strain as tariffs would likely fall. Alternatively, an increase in consumption could result in lower tariffs as the financial burden would be divided over a larger number of users. 

It merits a mention that the federal government has attempted to boost power consumption levels by getting a waiver that would allow surplus power capacity to be provided at a lower rate. As per reports, the waiver would have created provisions for 7000 megawatts (MW) of electricity.

Islamabad’s motivation behind the provision of power at lower rates lay in increasing economic output. This is because lower power rates for new entrants would yield higher industrial output.

However, the International Monetary Fund (IMF) did not support the scheme as it believed that the current state of the economy is a direct consequence of the distribution of similar allowances in the past.

The federal government has decided to revisit a proposal to increase the sales tax on smaller, locally assembled cars. Reports indicate a possible imposition of taxes on vehicles with engine capacities of up to 850cc.

These claims come despite Islamabad scrapping the idea just last week. According to a report, insiders familiar with the ongoing budget planning have stated that the earlier decision to hold off on the tax hike has been overturned and that the revised rates are being prepared for inclusion in this year’s Finance Bill. 

If passed, the new rates on the aforementioned vehicle type could fall anywhere between 15 and 18 percent. This marks a steep increase from the current sales tax rate these vehicles are subjected to, a relatively conservative 10 to 12.5 percent.

Reports suggest that lawmakers need to boost revenue levels during fiscal year (FY) 2025-26. With the budget for FY 2025–26 looming, officials are under mounting pressure to find new cash flows. The International Monetary Fund (IMF) wants Islamabad to increase revenues, as it has asked the federal government to incorporate agricultural income tax into provincial budgets, along with the expectation that provincial governments will observe austerity measures.

Raising taxes on small cars has remained unpopular, as it erodes the purchasing power of households that aren’t wealthy. Details for reports highlight that historically, small engine vehicles have been subjected to lower tax rates, keeping them within reach for working-class and middle-income households.

This spells bad news for domestic automobile assemblers as well, as a spike in taxes is likely to translate into higher car prices, which could reduce sales volumes. Sales volumes only recovered as inflation rates normalised in the outgoing FY, coupled with the State Bank of Pakistan (SBP) cutting interest rates to a conservative 11 percent. However, sales may tank upon the implementation of a tax hike.

If approved, the higher sales tax on small cars may lock a large segment of potential buyers out of the market for cars. Higher costs might potentially even cause some buyers to abandon purchasing a car altogether if prices rise significantly.

However, it merits a mention that a formal announcement is yet to be made. Buyers may scramble to place purchase orders before the announcement of the budget to avoid bearing higher sales tax rate.

The Speaker of the National Assembly (NA), Ayaz Sadiq, has approved the federal budget schedule, confirming that the budget’s presentation will take place on Tuesday, June 10. According to details shared by the NA Secretariat, the assembly will not meet on June 11 or 12, giving lawmakers time to go through the proposed budget.

Reports reveal that Khurram Schehzad, adviser to the finance minister, announced that the Pakistan Economic Survey will come out on Monday, June 9. Following the release of the survey, a full debate on the budget will start in the NA from June 13. Reports indicate that parties represented in the assembly will be allotted time according to the rules to present their viewpoints and concerns during the discussion.

According to the NA Secretariat’s statement issued on Sunday, the debate will continue until June 21, with no session on June 22, and will reconvene on June 23 to review the necessary expenditures for the fiscal year 2025–26. Reports suggest that votes and debates on proposed cuts and grants will be held on June 24 and 25.

The Finance Bill will reportedly reach its final stage on June 26, with discussions and a vote. The assembly will then move on to other matters, on June 27, going over matters including “supplementary grants”. Any alterations to this timetable, however, will only be allowed if permitted by the speaker himself.

Prime Minister Shehbaz Sharif has stated that his administration’s main objective in the budget is to offer relief to ordinary citizens. Alongside that, job opportunities, agricultural growth, housing, support for small and medium enterprises, and advancement in IT have been outlined as high-priority areas.

In similar budget-related developments, Planning Minister Ahsan Iqbal recently highlighted that the development budget would be around Rs1 trillion. He also gave a clear indication that the government may raise defence spending in the upcoming financial year.

Analysts will watch the budget sessions closely, as decisions made in the coming weeks will shape the macroeconomic landscape in the country. Latest data from the IMF suggests that government expenditure accounted for approximately 19.24 percent of GDP. If the federal government decides to boost expenditures in the upcoming budget, Pakistan’s GDP value will rise.

Prospective buyers of cattle have raised concerns surrounding the lack of health measures along with sellers attempting to charge extortionate prices for sacrificial animals. According to reports Khyber-Pakhtunkhwa is especially hard hit by such matters, with animal health experts outlining key issues plaguing markets.

Reports reveal that authorities in Peshawar have allocated two areas of the city to markets for Eid-ul-Adha. One of these markets is in Lala Kalay with the second one being located on the ring road. Both markets source their animals from various regions of Punjab such as Dera Ghazi Khan and Multan.

However, the absence of oversight in markets has allowed livestock traders to add a significant premium to the prices of their animals. This has caused buyers to run into significant issues who did not anticipate having to pay exorbitant sums of cash for livestock.

In an interview with a reputable English news organization, a prospective buyer of cattle visited the Ring Road market in Peshawar. However, to his dismay, he found out that animal prices have ballooned significantly over just one year.

Details from the interview suggest that livestock that used to be priced at two to three lakh rupees is now being sold at a staggering three to five lakh rupees. More alarmingly, even goats and sheep are fetching one to five lakh rupees in the market, highlighting the magnitude of the overpricing issue.

As per reports, the livestock market requires that all traders pay a fee of Rs1,500 to enter the market. However, the public does not benefit from these fee payments as animals are not subjected to any form of health checks prior to their entry into the market.

This results in buyers remaining unsure whether the animal they are purchasing is fit for consumption. As a result, prospective buyers have no choice but to bring vets to the market if they want to ensure they make the right purchase.

These concerns are not limited to buyer only, as multiple interviewees mirrored the same concerns. An interviewee critiqued the government’s approach to the situation, outlining the subpar performance of the Livestock Department despite possessing adequate resources.

However, sellers defend higher prices, claiming that they purchased the livestock at inflated rates. They highlighted that they could not sell their livestock at a loss and require a fair margin for their efforts. 

Sellers cite an increase in transportation expenses as a primary reason for the higher prices for the cattle. However, it merits a mention that petrol prices stand Rs4.53 lower than Eid-al-Adha season in 2024, weakening the claim of sellers.

A World Bank report reveals that approximately 45 percent of Pakistan’s citizens live below the poverty line. The change in the domestic poverty rates stems from updated poverty lines by the international lender.

According to the report, the percentage of Pakistanis living in extreme poverty skyrocketed from a conservative 4.9 percent to a staggering 16.5 percent. This rise in poverty rates does not have any correlation with macroeconomic conditions; it only changes because of the update in the international poverty line.

The global lender outlined how the poverty rate in Pakistan has been formulated keeping in view the updated $3 international poverty line (IPL) as per the 2021 purchasing power parity (PPP). This caused the new poverty rate to balloon to 16.5 percent.

Previously, the World Bank used a poverty line of $2.15 under 2017 PPP, which showed only 4.9 percent living in extreme poverty. The report explained that a whopping 82 percent of the rise in poverty can be explained by the higher IPL value.

The other 18 percent increase can be explained by price increases in the domestic economy that occurred during the 2017-21 time frame. The report also outlined how the poverty rate sits at 44.7 percent under an IPL of $4.2.

However, the global lender has highlighted that while Pakistan has witnessed a substantial hike in the rate of poverty, overarching trends in poverty remain unchanged. Senior Economist of the Poverty and Equity Global Practice, Ms Wieser, has outlined that shifting global poverty lines do not indicate that “poverty in Pakistan has worsened as living standards of the population have not changed to what was previously reported”.

Nevertheless, the report paints an alarming picture of the state of the economy. According to data released by the International Monetary Fund (IMF), Pakistan’s real gross domestic product (GDP) growth rate sits at an abysmally low 2.6 percent.

The aforementioned rate of economic growth is alarmingly low for an economy with a GDP per capita value of $1,580. The GDP per capita value may not witness a substantial rise in the coming period, given that Pakistan’s population growth is under two percent.

A slower growth in GDP per capita value indicates lower wealth being created per person. According to economists, this phenomenon may not allow Pakistan to escape the shackles of poverty for a prolonged period.

As the federal government gears up to present the budget for fiscal year (FY) 2025–26, a recent economic report by a Pakistani think tank Tabadlab has warned policymakers to not repeat past mistakes. According to reports, the group has specifically warned against pursuing “bad growth” strategies, which it defines as short-term booms that later collapse under structural weaknesses.

Tabadlab’s latest report has advised the government to refrain from raising tax rates, highlighting how Pakistan already has some of the highest tax burdens in the region. Instead of focusing on revenue through a hike in taxation, the report called for long term planning. It warned that encouraging consumption led growth could push the country back into a familiar boom and bust cycle. 

This is because Pakistan’s foreign exchange reserves remain critically low. Data from reports affirms that as of the start of June, reserves can barely cover two months of imports.

Despite the aforementioned vulnerabilities, the report acknowledged that Pakistan is displaying signs of macroeconomic stability. Inflation has slowed to a manageable five percent while interest rates have been fallen from a staggering 21 percent to a more reasonable 11 percent.

Furthermore, the rupee has settled near Rs280 per dollar with the risk of default having eased. Debt levels have also remained largely in check causing Tabadlab to attribute macroeconomic stability to a multitude of factors. 

These factors include discipline, implementing austerity measures, and luck. The macroeconomy has been “lucky” as it has been spared from a high trade deficit owing to a decline in global oil prices. 

The report outlined that while the Federal Board of Revenue (FBR) is expected to fall short of its ambitious Rs13 trillion target by around Rs1 trillion, it is still set to collect approximately Rs12 trillion, an improvement of Rs3 trillion from last year’s Rs9 trillion. 

On the expenditure side, the report mentions how the government has managed to rein in costs. The reduction in interest rates has cut debt servicing expenses by roughly Rs1 trillion. Similarly, austerity measures led to significant savings in public sector development spending. 

The initial Public Sector Development Programme (PSDP) target of Rs1.4 trillion was revised down to Rs1.1 trillion, but actual spending in FY25 stood at only Rs450 billion.

However, Tabadlab highlighted that this stability came at a cost. Poverty has increased by 6.5 percentage points over the past seven years, and the unemployment rate remains stuck at an alarmingly high eight percent.

In a bid to align Pakistan’s digital asset goals with the US, Federal Minister for Crypto and Blockchain, doubling as Chief Executive Officer (CEO) of the Pakistan Crypto Council (PCC), Bilal Bin Saqib held a meeting with Executive Director of US President Donald Trump’s Council on Digital Assets Robert Hines. According to a press release, both officials met at the White House to discuss how to align strategically on crypto.

As per reports, discussions between the two revolved around the integration of digital assets into both states’ respective economies. Both officials also went over the “future of decentralised infrastructure”.

Reports indicate that the meeting remained fruitful, with both sides expressing interest in building greater ties to boost digital asset innovation. The press release outlined how a key talking point was supporting innovation systems that “empower youth and accelerate economic inclusion through blockchain”.

The PCC’s CEO has highlighted the ability to leverage Pakistan’s youth for economic growth in the past. His blueprint at the Bitcoin Vegas 2025 placed Pakistan as a “youth-powered, and opportunity-rich nation ready to lead”.

It merits a mention that this high-profile meeting is being held after PCC’s CEO announced Pakistan’s first-ever government-led Strategic Bitcoin Reserve (SBR). PCC’s CEO made the announcement during a keynote speech at Bitcoin Vegas 2025 in Las Vegas, United States.

Recent developments indicate that the federal government has been moving to adopt crypto at a rapid pace. Islamabad recently allocated 2,000 megawatts of surplus power to crypto mining and to power artificial intelligence data centres.

Prior to his meeting with Bo Hines, the PCC’s CEO even asked crypto builders to tokenise land and “build wallets for the unbanked”. If builders heed his advice, Pakistan could witness a sizable influx of foreign direct investment (FDI), to the tune of billions of dollars, along with a potential increase in employment opportunities.

Following the successful launch of the SBR and calls to invest in Pakistan, the PCC’s CEO expressed his vision of Pakistan being “a leader in the Global South for Digital Assets”.

Bilal Bin Saqib was appointed as the PCC’s CEO in May 2025 when the federal government began efforts to adopt and regulate digital assets. His counterpart Bo Hines was appointed a few months prior, in January, by President Trump to lead policy development regarding digital assets.