Key takeaways
- About two million people join Pakistan's workforce each year.
- Debt service absorbs a large share of revenue, forcing repeated borrowing.
- Climate shocks are now macroeconomic variables, not tail risks.
- Each crisis-management cycle leaves the economy weaker.
- Tax, energy, export and governance reform are the four foundations.
In this Minute Mirror column (January 2026), Dr. Ghulam Mohey-ud-din argues that Pakistan is at a turning point. Several long-running pressures are converging, and the temporary fixes that have carried the economy from crisis to crisis are losing their effect.
The argument
The first pressure is demographic. Around two million people join the workforce each year. Unless job creation and productivity rise substantially, unemployment and social tension will grow. The second is debt. Debt servicing absorbs a large share of public revenue, which limits development spending and forces repeated external borrowing rather than genuine stabilisation.
The third is climate. Floods, heatwaves and water stress are no longer occasional shocks but recurring macroeconomic events. Countries without resilience planning, the author warns, will see volatility harden into structural decline.
Against these pressures, crisis management resets problems without solving them, and each cycle leaves the economy weaker than before. Pakistan still has real assets, including a young population and a strategic location, but those assets are wasted without credible institutions and predictable rules.
What needs to change
The column identifies four foundations for reform:
- Taxation: broaden a narrow, distortionary tax base.
- Energy: stop the financial bleeding of circular debt.
- Exports: diversify growth away from consumption and remittances.
- Governance: reduce policy uncertainty and enforce rules predictably.
The argument is ultimately about timing. With stabilisation tools losing their effect, delay itself becomes the most expensive choice.