Curbing Terror
An Islamabad-based think-tank has revealed that Pakistan experienced a 32% drop in overall violence in the second quarter of 2025, highlighting a marked reduction in fatalities and strategic improvements in counter-terrorism efforts while warning of concerning signs of militancy spreading into previously calmer regions. The report states KP and Balochistan continue to bear the brunt of the violence.
Fueling Inflation
The government has increased the prices of petrol and diesel by Rs. 8.36 and Rs. 10.39 per liter, respectively, for the next fortnight, citing higher global rates after the recent conflict between Israel and Iran. The price surge is anticipated to fuel inflation, as diesel is primarily used in the transport sector and often adds to the prices of essential commodities, while petrol has a direct impact on the middle class.
Tax Shortfall
The Federal Board of Revenue missed its tax collection target of Rs. 12.97 trillion for FY2024-25 by Rs. 1.235 trillion, collecting only Rs. 11.735 trillion. This was despite the Finance Ministry revising the target downward twice, initially from Rs. 12.97 trillion to Rs. 12.332 trillion and then again to Rs. 11.9 trillion. Despite this, the government has set an ambitious target of Rs. 14.131 trillion for FY2025-26.
Indus Waters Treaty
Following a ruling by the Permanent Court of Arbitration at The Hague, Pakistan has urged India to immediately resume the normal operations of the Indus Waters Treaty and faithfully honor its obligations under the accord. Responding to the order, however, India has rejected the authority of the court, describing it as a “charade at Pakistan’s behest.”
‘Simplifying’ Bills
The federal government has decided to abolish provincial electricity duty on power bills, with effect from July 1, and directed provincial chief ministers to explore “alternative mechanisms” for collecting provincial levies and duties. Power Minister Awais Leghari has said the move aims to ensure electricity bills reflect actual cost of power consumption rather than a collection mechanism for additional charges.
Ruling in Limbo
The Supreme Court Constitutional Bench’s ruling denying reserved seats to the PTI remains in limbo, as the party claims the written order must bear the signatures of all 12 judges of the bench before it can be implemented. Presently, the short order lacks the signatures of Justices Ayesha A. Malik and Aqeel Ahmed Abbasi, who had moved to dismiss the review petitions in the first hearing.
Looming Cost Surge
Independent Power Producers (IPPs) have warned the government that proposed levies on furnace oil may significantly raise electricity generation costs and disrupt refinery operations. In letters sent to the Petroleum Division and other stakeholders, the IPPs have specifically cited the planned imposition of a carbon levy and petroleum levy on furnace oil as drivers of inflationary pressures.
Tight Security
Interior Minister Mohsin Naqvi has vowed a comprehensive security plan for Muharram to check miscreants and improve surveillance. Visiting the central Imambargah Asna Ashari in Islamabad, he has said security is on high alert to thwart any nefarious designs of cowardly enemies. He has also said the Army would be available to support the civil administration in security during Muharram processions.
Trade Deal
A Pakistani delegation has reached Washington to finalize a trade agreement aimed at recalibrating economic ties with the U.S. following the imposition of since-suspended high import tariffs by President Donald Trump. Pakistan currently faces a 29% tariff on its exports to the U.S., with Trump pointing to Islamabad’s $3 billion trade surplus with Washington in 2024 to justify the decision.
‘Not Our Problem’
The federal government has informed the Islamabad High Court (IHC) it will not become a party to, or provide legal assistance, in Dr. Afia Siddiqui’s ongoing case in the United States. The IHC has directed the government to submit a justification for its decision at the next hearing on July 4. The case pertains to a plea seeking Siddiqui’s repatriation from a U.S. prison, where she has been detained for over 14 years.