Prime Minister Shehbaz Sharif and Finance Minister Muhammad Aurangzeb recently addressed the Pakistan Stock Exchange (PSX), signaling a dual focus on enhancing export performance and deepening capital markets. The Prime Minister critically assessed the past performance of export-oriented industries, urging them to deliver on incentives received, while the Finance Minister outlined a comprehensive reform agenda aimed at fiscal discipline and diversifying national borrowing. These directives underscore the government’s commitment to achieving export-led, sustainable economic growth, with a projected 4% expansion for the current fiscal year 2026-27.
By SarmayaNext Financial Markets Desk • ✓ Fact-Checked • Published October 2026
PM Urges Exporters to Deliver as FinMin Unveils PSX Reform Agenda
Prime Minister Shehbaz Sharif urged Pakistani exporters to enhance performance for sustainable economic growth, criticizing past failures despite incentives. Simultaneously, Finance Minister Muhammad Aurangzeb presented a reform agenda at the PSX, emphasizing fiscal discipline, capital market development, and a projected 4% economic growth for FY2026-27, up from 3.7% in FY26.
During a virtual address at a gong ceremony organized by Arif Habib Corporation at the Pakistan Stock Exchange (PSX) in Karachi, Prime Minister Shehbaz Sharif stated the government’s commitment to export-led, sustainable economic growth following a period of economic stabilization. He expressed strong criticism towards certain export-oriented industries, noting that despite receiving substantial government support and incentives over decades, they had not delivered the desired results. The Prime Minister highlighted that prices of relevant products had increased, quality had deteriorated, and import substitution goals remained unmet. He urged these industries to rectify their course and actively contribute to the nation’s export drive, recalling that the federal budget for 2026–27 provided significant tax breaks and incentives for exporters, manufacturers, and the construction sector, with some incentives for the construction sector already yielding positive outcomes.
Concurrently, Finance Minister Muhammad Aurangzeb, speaking in person at the PSX Trading Hall, presented a detailed review of the ongoing reform agenda agreed upon under the IMF Extended Fund Facility. He emphasized the government’s need for greater fiscal discipline and a strategic shift in borrowing, moving away from banks towards non-banks and retail investors. The Finance Minister also highlighted the work of the Capital Market Development Council, which includes the Governor of the State Bank of Pakistan (SBP) and the Chairman of the Securities and Exchange Commission of Pakistan (SECP), among other stakeholders. This council is actively reviewing all asset classes, including Venture Capital Funds (VCS), Sukuks, and Real Estate Investment Trusts (REITs), alongside broader taxation and regulatory reforms to scale up capital markets. Recommendations from this council are expected by the end of the year for the Prime Minister’s Office, SBP, SECP, and the Ministry of Finance, with the SECP already developing a legislative agenda for Parliament. Aurangzeb projected Pakistan’s economy to grow by 4% in the current fiscal year 2026-27, an increase from the 3.7% registered in FY26, while cautioning against consumption-led growth that could quickly reach 6% but risk a boom-and-bust cycle.
Pakistan’s Economic Growth & Tax Filers Overview
| Indicator | FY26 (Previous Year) | FY26-27 (Current Year Projection) |
|---|---|---|
| Economic Growth | 3.7% | 4% |
| Tax Filers | 3.9 million | 5.7 million (45% increase) |
Pakistan’s Foreign Exchange Reserves (Approximate)
| Category | Amount (USD) |
|---|---|
| State Bank of Pakistan (SBP) Reserves | 21.4 billion |
| Commercial Banks Reserves | 5.5 billion |
| Eurobond Issuance | 3 billion (attracted $6 billion bids) |
Implications for Pakistan’s Economy, Businesses, and Capital Markets
The Prime Minister’s direct criticism of exporters signals a heightened demand for accountability and performance from industries that have historically benefited from state support. This stance aligns with the government’s broader strategy to transition from economic stabilization to sustainable, export-led growth, which is crucial for addressing Pakistan’s persistent balance-of-payments challenges. By emphasizing productivity improvement, industrial modernization, and strengthening exports, the government aims to foster a more competitive and self-reliant economy. The commendation of real estate and industrial initiatives under the REIT structure, particularly those spearheaded by business leaders like Arif Habib, indicates a recognition of innovative financing models that can contribute to economic activity and capital formation.
Finance Minister Aurangzeb’s reform agenda, presented at the PSX, underscores a strategic pivot towards deepening Pakistan’s capital markets as a primary source of funding. Shifting borrowing from traditional banks to non-bank institutions and retail investors could diversify funding sources, reduce systemic risk, and provide new investment avenues for the public. The comprehensive review of asset classes, taxation, and regulatory frameworks by the Capital Market Development Council, involving key financial regulators, suggests a concerted effort to create a more robust and attractive investment environment. This could unlock significant capital for various sectors, including technology and infrastructure, and enhance the PSX’s role in economic development.
The projected economic growth of 4% for FY2026-27, while modest, reflects a commitment to sustainable expansion over short-term, consumption-driven booms that often lead to economic instability. This cautious approach, coupled with an emphasis on fiscal discipline and adherence to the IMF program, is vital for maintaining investor confidence and attracting foreign direct investment. The reported increase in tax filers by 45% to over 5.7 million, alongside significant mobilization in housing finance, indicates some success in broadening the tax base and stimulating specific economic sectors. These efforts collectively aim to put Pakistan on a stronger path of economic recovery and global competitiveness.
For investors, these developments signal both opportunities and a changing regulatory landscape. The government’s focus on capital market reforms, including the review of asset classes like VCS and REITs, could introduce new investment products and increase market liquidity. However, the increased scrutiny on export-oriented industries may also lead to policy adjustments affecting their profitability or operational frameworks. Monitoring the recommendations from the Capital Market Development Council and the legislative agenda from SECP will be crucial for understanding the evolving investment environment and identifying strategic entry or exit points in various sectors.
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Key Takeaways
- Prime Minister Shehbaz Sharif urged Pakistani exporters to improve performance, criticizing past failures despite significant government incentives.
- Finance Minister Muhammad Aurangzeb outlined a comprehensive reform agenda at the PSX, focusing on fiscal discipline, shifting borrowing to non-banks, and developing capital markets.
- Pakistan’s economy is projected to grow by 4% in FY2026-27, with a strategic preference for export-led sustainable growth over consumption-driven booms.
- Key initiatives include reviewing asset classes (VCS, Sukuks, REITs) and legislative reforms to scale up capital markets, with recommendations expected by year-end.
- Macroeconomic stability is improving, evidenced by rising foreign exchange reserves, increased remittances, and a 45% surge in tax filers.
The Insider Take
The dual message from Pakistan’s leadership at the PSX marks a critical juncture: a clear demand for accountability from traditional export sectors paired with an ambitious push to modernize and deepen financial markets. This strategy aims to fundamentally re-engineer Pakistan’s economic engine, moving beyond reliance on subsidies towards a more merit-based, market-driven growth model. Investors should closely track the Capital Market Development Council’s upcoming recommendations and SECP’s legislative actions, as these will likely shape the next wave of opportunities and regulatory shifts across Pakistan’s equity and debt markets.
Frequently Asked Questions About PM urges exporters deliver
Why is Prime Minister Shehbaz Sharif urging exporters to deliver?
Prime Minister Shehbaz Sharif is urging exporters to deliver because, despite receiving substantial government incentives and tax breaks over decades, many export-oriented industries have not achieved desired results. He noted issues like increased product prices, deteriorated quality, and a failure to achieve import substitution, emphasizing the need for these sectors to contribute effectively to sustainable, export-led economic growth.
What are the key components of Finance Minister Muhammad Aurangzeb’s reform agenda for the PSX?
Finance Minister Muhammad Aurangzeb’s reform agenda for the PSX focuses on enhancing fiscal discipline and shifting government borrowing from banks to non-banks and retail investors. It includes a comprehensive review by the Capital Market Development Council of all asset classes like VCS, Sukuks, and REITs, alongside taxation and regulatory reforms aimed at scaling up capital markets. Recommendations are expected by year-end.
How is Pakistan’s economic growth projected for the current fiscal year 2026-27?
Pakistan’s economy is projected to grow by 4% in the current fiscal year 2026-27, an increase from 3.7% in FY26. Finance Minister Muhammad Aurangzeb emphasized pursuing an export-led, sustainable growth model, deliberately avoiding a consumption-led approach that could quickly achieve 6% growth but risk a boom-and-bust economic cycle.
“I do not want to name the export industries that have failed to deliver.” — Prime Minister Shehbaz Sharif
“but prices of relevant products have gone up, while the quality has deteriorated.” — Prime Minister Shehbaz Sharif
“The government has to show more fiscal discipline, and at the same time, we want to shift our borrowing away from banks to non-banks and retail investors.” — Finance Minister Muhammad Aurangzeb
“We will, by or before the end of the year, come up with recommendations.” — Finance Minister Muhammad Aurangzeb
PS: For educational and informational purposes only. Not financial advice. Investing involves risk — consult a qualified financial advisor before making investment decisions.