MH Insights

Executive Summary This briefing synthesizes key economic, financial, and industrial developments at the start of January 2026. In Pakistan, the new year began with a robust performance on the Pakistan Stock Exchange (PSX), which surged to a new all-time high, reflecting strong investor optimism. Concurrently, the Federal Board of Revenue (FBR) is intensifying efforts to meet revised tax targets for FY2025-26 after experiencing a significant shortfall in the first half, considering new excise duties and continuing desk audits for exporters. The Sindh Revenue Board, however, reported strong 21% growth in tax collection. The corporate sector saw significant activity, including a Rs 15 billion capital injection into U Bank by PTCL Group, the successful IPO and listing of Pak-Qatar Family Takaful Limited, and the launch of the Lucky Islamic Energy Fund. Key strategic industrial initiatives are underway, notably the plan to establish Pakistan's first semiconductor chip manufacturing unit...

 Executive Summary This document synthesizes key developments across Pakistan's economy, financial markets, and major industries as of the start of 2026. The analysis reveals a complex landscape characterized by fiscal pressures and macroeconomic improvements, robust stock market performance in 2025 despite underlying economic challenges, and significant shifts in corporate strategy and regulatory enforcement. Key Takeaways: Fiscal Challenges Persist: The Federal Board of Revenue (FBR) faces a significant revenue shortfall of over Rs 336 billion for the first half of fiscal year 2025-26, prompting a downward revision of the annual target. The government has committed to contingency tax measures to meet IMF agreements. Exceptional Stock Market Performance in 2025: The Pakistan Stock Exchange's KSE-100 Index delivered an impressive 51% return in CY2025, ranking as the second-best performing frontier market. This growth was driven by political stability, interest rate cuts, and ...

Executive Summary This briefing document synthesizes critical developments across Pakistan's economic, regulatory, and corporate landscapes as of year-end 2025. The overarching theme of 2025 was turbulence, characterized by significant microeconomic pressures on businesses, including high energy costs and excessive taxation. Despite these challenges, several positive macroeconomic indicators emerged, such as a sharp reduction in the policy interest rate, improved foreign exchange reserves, and a powerful bull run in the stock market. The regulatory environment is undergoing a significant transformation, with the Federal Board of Revenue (FBR) aggressively expanding its digital surveillance and enforcement powers. New legal provisions grant the FBR real-time access to a wide array of citizen and business data and the authority to conduct unannounced premises inspections. These measures have been met with resistance, leading to organized protests by traders who decry the policies as ...

 Executive Summary This briefing synthesizes critical developments across Pakistan's taxation, financial markets, and industrial sectors as of late December 2025. The Federal Board of Revenue (FBR) is significantly expanding its oversight of the economy through enhanced data-sharing mandates for banks and new monitoring protocols for the digital e-commerce sector, effective from tax year 2026. These measures, alongside a robust withholding tax system, are central to the FBR's strategy to broaden the tax base and improve compliance. Financially, the Pakistan Stock Exchange (PSX) has concluded the year at a historic high, with equities projected to be the best-performing asset class in 2026. This optimism is fueled by improving macroeconomic stability, significant external financing inflows from multilateral partners, and progress on structural reforms, notably the privatization of Pakistan International Airlines (PIA). Despite the positive market sentiment, Pakistan's indust...

Executive Summary This document synthesizes critical developments across Pakistan's economy, global financial markets, and key technology sectors as of late December 2025. The most significant takeaway is the historic performance of the Pakistan Stock Exchange (PSX), with the KSE-100 index closing at a new all-time high of 172,400.73, driven by strong buying momentum and improved investor sentiment. In parallel, Pakistan's regulatory and technology landscapes are evolving. The State Bank of Pakistan (SBP) has issued a comprehensive framework to manage climate-related financial risks, mandating compliance by June 2029. The government is also prioritizing technological advancement, with a stated focus on artificial intelligence (AI), robotics, and space innovation to modernize the economy. However, challenges persist in the digital payments ecosystem, with reliability concerns and regulatory bottlenecks hindering user confidence. On the global stage, markets are exhibiting typica...

 Executive Summary This document synthesizes critical developments across Pakistan's economy, global financial markets, and the technology sector as of late December 2025. Key takeaways include a significant overhaul of Pakistan's tax deduction framework for 2026, coupled with a highly aggressive enforcement drive by the Federal Board of Revenue (FBR). The country's export sector faces severe headwinds, evidenced by a nearly 50% plunge in rice exports and the implementation of stricter regulations for cotton shipments. Globally, financial markets are experiencing a robust year-end "Santa Claus rally," with U.S. indices hitting record highs and Asian markets showing significant strength. Precious metals, particularly gold and silver, are surging to new peaks. The technology sector is marked by Pakistan's definitive plan for a 5G rollout in 2026 and major product announcements from global giants like Samsung, Xiaomi, and Oppo, focusing on AI integration and next...