Latest news with #MuhammadAurangzeb
Arab News
9 hours ago
- Business
- Arab News
Pakistan's finance chief stresses apolitical funding approach in meeting with World Bank officials
KARACHI: Pakistan's Finance Minister Muhammad Aurangzeb on Friday called for a merit-based approach to global development financing, urging international lenders to rise above political considerations during a meeting with incoming and outgoing World Bank country directors in Islamabad. The meeting followed weeks of diplomatic friction between nuclear-armed rivals India and Pakistan, which escalated into a four-day military standoff involving fighter jets, missiles, drones and artillery fire. Amid the tensions, Indian authorities lobbied the International Monetary Fund (IMF) to halt the disbursement of a $1 billion tranche to Pakistan, saying the funds could finance Islamabad's military activities. IMF officials later dismissed the concerns, emphasizing the disbursement mechanisms ensured transparency and that IMF support was intended to stabilize developing economies' balance of payments, with the funds directed to central banks rather than governments. 'The Minister ... highlighted the recent successful completion of the International Monetary Fund (IMF) review and the subsequent $1 billion disbursement under the Extended Fund Facility (EFF), along with additional resources made available through the Resilience and Sustainability Facility (RSF),' said a statement circulated by the finance ministry after the meeting. 'He noted that development finance must be guided by merit and objective assessment, rising above political considerations to ensure sustainable progress,' it added. Aurangzeb also praised the World Bank's longstanding support for Pakistan's economy, especially in times of fiscal stress, and reiterated Islamabad's commitment to deepening collaboration with the institution. He extended a warm welcome to Bolormaa Amgaabazar, the new World Bank Country Director for Pakistan, while commending her predecessor, Najy Benhassine, for his contributions during his tenure. A key point of discussion was the World Bank's 10-year Country Partnership Framework (CPF), a strategic agreement designed to guide development cooperation through targeted investments in Pakistan's critical sectors. The CPF, finalized during Benhassine's tenure, will now be overseen by Amgaabazar and aims to unlock $20 billion for the country. Aurangzeb highlighted the importance of effective implementation of the framework to fully leverage the Bank's institutional, technical and financial support. The meeting reaffirmed mutual commitment to strengthening Pakistan's economic resilience and advancing inclusive development through strategic partnerships, the finance ministry said.
Business Recorder
14 hours ago
- Business
- Business Recorder
Finance Bill 2025–26: CAP urges govt to overhaul retail tax structure
LAHORE: Pakistan's organized retail sector on Friday urged the government to overhaul the current retail taxation structure in the upcoming Finance Bill 2025–26, highlighting the urgent need for fairer policies to support compliant businesses and expand the tax base. In a detailed appeal to Federal Minister for Finance Muhammad Aurangzeb, the Chainstore Association of Pakistan (CAP)—the official representative body for over 150 Tier-1 retail chains—called for inclusive policy-making through structured consultation with the private sector. CAP stressed that the upcoming budget presents a critical opportunity to resolve long-standing disparities and bring undocumented retailers into the tax net without penalizing compliant players. CAP acknowledged the Finance Minister's leadership and reiterated its confidence in the government's commitment to reviving the economy. The association underscored the significant contributions of integrated retailers to employment, commerce, tax revenues, and export value chains, despite representing only a fraction of the retail and wholesale trade landscape. At present, POS-integrated retailers contribute approximately 25–30% of their turnover in taxes under various heads. Meanwhile, the vast majority of the retail sector remains either under-taxed or entirely undocumented. CAP warned that this growing imbalance has placed an unsustainable burden on documented businesses, many of whom have been forced to downsize or shut down in recent years. CAP Chairman Asfandyar Farrukh noted that strict enforcement actions and unresolved technical issues in the FBR-POS system have further disrupted operations for compliant retailers. The withdrawal of GST concessions for documented consumers last year, coupled with the failure of the Tajir Dost Scheme due to a lack of consultation and planning, has only worsened the situation. 'To prevent another setback, the Finance Bill 2025–26 must introduce bold, technology-led solutions that broaden the tax base without penalizing formal businesses,' Farrukh emphasized. To drive formalization and promote a cashless economy, CAP proposed fixed GST rates on retail sales made via digital payments 1–2% for consumer goods and 3–4% for textile and leather items. These rates should be extended to all tiers of retailers, including small and mid-sized enterprises, along with simplified compliance measures and alignment with provincial digital payment incentives. CAP maintains that such a framework will reduce costs, encourage documentation, and accelerate tax collection. The association also recommended a fixed quarterly advance income tax regime for small retailers, payable via mobile wallets and adjustable against annual income tax returns. Predictable rates for 3–5 years, coupled with incentives such as government service privileges or cash back offers, would increase voluntary compliance and build trust. To reignite consumer engagement in tax compliance, CAP urged the government to revive the FBR-POS Prize Scheme, which has been suspended since November 2022. Additionally, the association demanded transparency in the use of the over Rs1.2 billion collected through the POS Re1 per invoice fee under the IRS Common Pool Fund. Despite their large contributions, organized retailers remain restricted to just 10% of Pakistan's retail sector, compared to 15–20% in comparable regional economies. CAP warned that unchecked informal competition, coupled with rising compliance costs, continues to hamper sector growth. The association reiterated its readiness to collaborate with government institutions, including the Ministry of Commerce, FBR, SBP, CCP, and others, to support the development of a fair, digital, and growth-oriented retail tax ecosystem. A formal meeting has been requested with the Finance Minister to present CAP's proposals and assist in shaping meaningful reforms in Budget 2025–26. Copyright Business Recorder, 2025
Business Recorder
14 hours ago
- Business
- Business Recorder
Reciprocal tariff talks with US formally launched
KARACHI: In a major move on the economic front, Pakistan on Friday formally initiated negotiations with US authorities over the newly-announced reciprocal tariffs that Washington imposed on a wide range of trading partners, including Pakistan. Khurram Schehzad, Advisor to Pakistan's Finance Minister has revealed that Federal Finance Minister Muhammad Aurangzeb on Friday held talks with Ambassador Jamieson Greer, United States Trade Representative through a conference call and exchanged their viewpoint on reciprocal tariff with the understanding that technical level detailed discussions would follow in the coming weeks. The talks follow an April 4 announcement by US President Donald Trump, unveiling sweeping import taxes on goods entering the United States. Under the new policy, the US is set to impose a 29 percent reciprocal tariff on Pakistani goods. The measure is part of a broader global tariff strategy affecting over 185 countries and territories. Trump praises 'brilliant' Pakistanis, says Islamabad 'would love to trade with US' The announcement by the US President sparked concerns among Pakistani exporters, who fear the move could disrupt trade flows to US markets and hurt export competitiveness. In response, Pakistan's federal government has moved swiftly to engage US authorities to seek relief or adjustments. Khurram Schehzad, Advisor to Finance Minister Muhammad Aurangzeb, revealed on his official X (formerly Twitter) account that formal negotiations commenced today (Friday) via a telephonic conference call between Finance Minister Aurangzeb and US Trade Representative Ambassador Jamieson Greer. 'Pakistan's formal negotiations on US Reciprocal tariffs kick-started between Muhammad Aurangzeb, Pakistan's Finance Minister and Ambassador Jamieson Greer, United States Trade Representative through a telephonic/conference call on 30th May, 2025', Schehzad said on X. Both sides exchanged their viewpoint through a constructive engagement with the understanding that technical level detailed discussions would follow in the coming weeks, he said and added that both sides expressed confidence in advancing the negotiations for successful conclusion at the earliest. Under the US's new trade policy/tariff regime, Pakistan is among several countries facing steep duties, including India (26 percent), China (145 percent), the European Union (20 percent), and Saudi Arabia, Qatar, and Afghanistan (10 percent each). Copyright Business Recorder, 2025
Business Recorder
14 hours ago
- Business
- Business Recorder
Pakistan Crypto Council's meeting on Monday
ISLAMABAD: The Pakistan Crypto Council will convene a high-level meeting on Monday, 2nd June 2025, to be chaired by Senator Muhammad Aurangzeb, Federal Minister for Finance and Revenue. The meeting will serve as a strategic forum to deliberate on the evolving regulatory and legal framework surrounding digital currency and the broader crypto landscape in Pakistan. Bilal Bin Saqib, Minister of State/Special Assistant to the Prime Minister on Blockchain and Crypto, will participate in his capacity as the chief executive officer of the Pakistan Crypto Council. The meeting will also be attended by members of the council, including the governor, State Bank of Pakistan (SBP); chairman, Securities and Exchange Commission of Pakistan (SECP); secretary, Law and Justice Division; and secretary, Ministry of Information Technology and Telecommunication. Key items on the agenda include the development of a robust regulatory framework to govern digital and virtual assets in Pakistan, in alignment with global standards and technological advancements. A focal point of discussion will be the groundwork for the establishment of the Pakistan Virtual Assets Regulatory Authority (PVARA) — a proposed autonomous body to oversee the digital finance and crypto ecosystem in the country. The council aims to lay the foundation for a secure, transparent, and innovation-friendly regulatory environment, with a view to promoting responsible adoption of blockchain technology, protecting investors, and enhancing financial inclusion. Copyright Business Recorder, 2025
Arab News
a day ago
- Business
- Arab News
Pakistan formally initiates talks with US on ‘reciprocal tariffs' amid export concerns
KARACHI: Pakistan has formally begun negotiations with the United States over newly imposed 'reciprocal tariffs,' an official statement said on Friday, with Finance Minister Muhammad Aurangzeb holding a conference call with US Trade Representative Ambassador Jamieson Greer to launch the process. The talks come after US President Donald Trump imposed steep tariffs on a number of countries earlier this year, a move widely viewed as a setback for the global economy still recovering from the coronavirus pandemic. Defending the action, Trump said the tariffs were necessary to correct trade imbalances and counter what he described as unfair treatment of American goods abroad. Pakistan was among the countries affected, with a 29 percent tariff placed on its goods at a time when Islamabad is pushing for export-driven growth. Aurangzeb called the development both a challenge and an opportunity to reset trade ties in April, adding that a high-level delegation would soon travel to Washington to pursue the matter further. 'Pakistan's formal negotiations on US reciprocal tariffs kick-started between Mr. Muhammad Aurangzeb, Pakistan's Finance Minister and Ambassador Jamieson Greer, United States Trade Representative through a telephonic/conference call on 30th May, 2025,' the finance ministry said. 'The two sides exchanged their viewpoint through a constructive engagement with the understanding that technical level detailed discussions would follow in the coming few weeks,' it added. The ministry said both sides expressed confidence in advancing the negotiations toward a successful conclusion at the earliest. The US is Pakistan's largest export destination, and the newly imposed duties threaten to undermine Islamabad's fragile economic recovery. According to Pakistan's central bank, the country exported $5.44 billion worth of goods to the US in 2024. From July to February of the current fiscal year, exports to the US reached $4 billion, up 10 percent from the same period last year. Nearly 90 percent of those exports are textiles, which analysts say will be hardest hit. Experts have also warned previously the tariffs could reduce Pakistan's competitiveness, especially if regional exporters such as China, Bangladesh and Vietnam redirect more goods to Europe, intensifying competition in alternative markets.
