Mian Zahid urges govt to address rising inflation

Mian Zahid Hussain, a prominent businessman and intellectual leader, has called on the government to tackle the root causes of inflation. High costs of electricity, gas, petrol, diesel, transport and certain food items not only burden low-income families but also raise production expenses for businesses and impede competitiveness.

The public sector's underperformance has led to annual losses of approximately Rs800 billion, compounded by significant power-sector line losses, electricity theft, and weak recoveries, amounting to around Rs1 trillion, ultimately imposing an avoidable financial strain on consumers and industry. Mian Zahid stressed the need for supply-chain improvements and enhanced digital tracking of essential commodities to prevent additional cost transfers to the public and productive sectors.

He endorsed the World Bank's suggestions, acknowledging the government's Benazir Income Support Programme, which provides targeted assistance to low-income households, and the introduction of fuel relief. However, he emphasized that lasting poverty alleviation necessitates more than relief measures, advocating for macroeconomic stability alongside investment in human resources, infrastructure, dignified employment, and private-sector growth.

Mian stressed that artificial intelligence should be seen as an opportunity to boost productivity rather than an immediate threat to jobs, urging Pakistan to enhance digital skills, local-language data, reliable internet access, and businesses' capacity to adopt technology. He highlighted that industrialization, value addition, and export-led growth remain crucial for reducing poverty.

The World Bank's October 2026 report, "Middle East, North Africa, Afghanistan and Pakistan Economic Update: From Divide to Opportunity: AI, Jobs, and Growth," paints a grim picture of economic conditions in Pakistan and the broader MENAAP region, warning of the need for serious policy adjustments in light of the worsening poverty situation.

Mian argued that economic stability should be measured by rising household incomes, decent employment, and access to basic necessities, rather than solely by GDP growth, foreign-exchange reserves, or other financial metrics. According to the World Bank, Pakistan has the highest share of extreme poverty (48 percent) in the MENAAP region, below the international USD 3-a-day poverty line.

In 2024, 14.3 percent of the region's populace lived on less than USD 3-a-day, compared to 10.4 percent globally. This situation is particularly concerning as MENAAP is the sole region where poverty remains above pre-pandemic levels and continues to grow. Between 2018–19 and 2024–25, Pakistan's poverty rate at the USD 3-a-day threshold surged by 6.4 percentage points, largely due to successive shocks such as the COVID-19 pandemic, the 2022 floods, high inflation, currency depreciation, and the challenging adjustment measures needed to restore economic stability.

These factors eroded household incomes and employment opportunities, disproportionately affecting low-income groups. The World Bank forecasts Pakistan's GDP growth at 3.8 percent and inflation at 8.2 percent in 2027. Should inflation rise alongside modest growth, ordinary citizens, small businesses, and industry will face ongoing pressure on their purchasing power.

The projected real per-capita GDP growth of 2.2 percent in 2027 indicates limited prospects for widespread prosperity amidst rapid population growth. Mian emphasized that macroeconomic improvements must be considered alongside employment, wages, food affordability, and household purchasing power.