Pakistan can fix its own fundamentals — the reason it won't

The first episode from a city built on getting out of the way

The 357th episode opens in a new room — Muzamil’s first recording from the Dubai studio, and he says why he came. A story is emerging across Riyadh, Doha, Bahrain, the whole region: something that looks, in his telling, like a new Europe taking shape. He wanted to understand it from inside, and he brought the right person to explain it.

Junaid Iqbal has been a resident of Dubai since 2015, and for years before that flew in weekly while running Careem in two countries at once. He was managing director of Careem Pakistan, then Careem Saudi Arabia, and by the Uber acquisition was MD of Careem Pay for all markets. But the thread that makes him useful for this conversation runs further back. He was one of the country’s first business journalists, and he spent the better part of a decade learning the Pakistani economy from the inside before he ever ran a company.

How a power trader in Ohio ended up anchoring Pakistan’s first live market show

Iqbal grew up in Karachi, did his O and A levels there, and studied economics at the University of Michigan. His first job was at American Electric Power, one of the largest US power producers, trading energy in the years right after Enron collapsed. He was good at it — good enough that when he flew home in 2004 to get his H-1B stamped, the company offered to fast-track his green card.

He turned it down. While waiting on the visa in Karachi, his mother pushed him toward a meeting at the new Geo TV. They auditioned him on the spot, told him to redo it in Urdu, and within days put him on air. When the green card offer came, he flew back to the US to resign. He frames the decision plainly: a permanent foothold in the world’s biggest economy, set against coming home. He came home. He notes, without drama, that his family had walked away from US residency twice — his own lapsed Canadian status, his father later cancelling a sponsored green card — and that leaving Pakistan for good simply never entered anyone’s head.

Geo sent him to Dubai to build Teji Mandi — bullish, bearish — Pakistan’s first live market-hours stock show, launched July 2004. There was no real-time data feed, so he and a colleague went to Wavetech, got a charting tool built (Wavetech’s logo on it as payment), and hunted down a scan-rate converter in Dubai’s electronics market to make a laptop’s output broadcast-grade. After Geo came a short government stint at the SECP, then CNBC Pakistan, where he ran two daily shows and headed research off a Bloomberg terminal. He calls it “a free MSc in economics.”

Why business television died and the screaming filled the gap

Muzamil widens the lens: in 2004, with fewer banks, thin telecom, and the internet barely reaching the masses, they were running stock-market shows on mainstream TV. Today there are fifty news channels and, in Iqbal’s blunt phrase, “fifty out of fifty are brain dead.” The 7-to-11 prime slot is a fight, not a conversation. Back then, three full business channels — CNBC, Business Plus, Sunbiz — ran economy coverage around the clock, and nearly every general channel carried a business segment.

Iqbal’s diagnosis is that the economy stopped being discussed and the narrative took over. The question is no longer how to make the country an economic powerhouse; it’s who is good and who is bad. He refuses the easy excuse that audiences won’t watch substance. “It’s a cop-out,” he says. “It’s a lack of genius.” He points to Shark Tank India making a cart-vendor’s business legible to ordinary viewers as proof that complexity can be made simple — and to America’s 60 Minutes as proof that serious content has always had to be willed onto the schedule. There are three kinds of conversation a channel can have, he argues: what are the facts, how do we fix this, and he-said-she-said. Pakistan chose the third, and got the outcome the third produces.

The arithmetic almost nobody walks through

When the talk turns to the economy itself, Iqbal does the thing the discourse usually skips — he lays out the numbers. The economy is roughly $350bn. The federal budget is about $50bn. Of that, around $30bn comes from tax and $20bn is borrowed, and the borrowing share grows every year.

Then he traces where the $50bn goes. Roughly $25bn vanishes into interest payments. Defence takes about $7bn, government running costs about $3bn, military and civil pensions about $3bn. That is roughly $38bn spent simply to stay alive before anything reaches development. The remaining $12bn has to cover provinces, education, healthcare, and development — and most of it is borrowed.

The deeper problem is the shape of the debt. Pakistan’s economy has grown at about 3.8% a year over the past decade while its debt has compounded at 10–11%. Borrowing itself isn’t the sin — plenty of countries borrow. The sin is borrowing for current expenses rather than development. Iqbal’s image is a household that takes a loan to educate its children versus one that takes a loan to buy a television.

Four structural problems, four vested interests

He names the four structural issues directly: taxation, agriculture, energy, and the size of government.

On tax, the headline isn’t that Pakistanis are over-taxed in aggregate — it’s that collection is lopsided and the rates are punishing. Tax-to-GDP is around 9% when poorly-run peers hit 12% and better ones reach 15%. There are about 2.5m active filers. So the state leans on lazy taxes — sales tax, withholding — while real estate is under-assessed, agriculture pays no federal income tax, and undocumented cash simply opts out through the “non-filer” category. His fix is unglamorous: document the economy, cut the corporate rate (above 30%, “you’re charging European tax”), collapse the 70 tax types down to three or four, replace a 15-step filing process with API integrations to utilities and employers, and make evasion impossible rather than expensive. Raising tax-to-GDP from 9% to 12% alone, he notes, adds roughly $10bn.

But the reason none of it happens, he argues, is not incompetence or even corruption — though both exist. It is stakeholders. Reform tax and you upset traders, who are a core PML-N vote bank. Reform agriculture and you hit the landlord base of the PPP and the agriculturalist electables PTI relies on. Reform energy and you sit across from “the elite of the elite” — industrial families and regional power interests — plus a military tied closely to land. The vested interests overlap. With political will, he says, ten or twelve reforms over five years would fix the fiscal structure. Without it, the same magic shiny object — oil one cycle, minerals the next — gets sold to each new government.

Agriculture and energy: the security risks nobody calls security risks

Iqbal spends his sharpest minutes on agriculture. It is 22% of the economy, pays no federal income tax, receives subsidised urea, and has its sugar and wheat bought at support prices — and it still yields three tons of wheat per hectare against France’s eight. Meanwhile Pakistan imports $8bn of food and $3.5bn of edible oil. He keeps returning to the framing: if food import is a national-security risk, why isn’t food production treated as one? His prescription is to tax land, end the parking of money in land by closing the gap between collector and market value, and push large low-yield holdings toward high-value, exportable, or oil-bearing crops.

Energy is the hardest, he concedes, because the imported RFO- and LNG-based plants are already built and running. Hydel generates about 28% of the country’s power this year at a fraction of the cost of imported fuel — the cost difference runs around one to thirty — yet decades were lost to inter-provincial water politics instead of building dams, and the window to finance Thar coal has closed as climate-linked lending dried up. His creative move: go to the IMF not with a begging bowl but with a plan — finance to buy back RFO contracts and expand hydel, staying carbon-neutral by offsetting coal against the RFO retired.

On the size of government, the numbers are almost comic. Forty-four ministries; the prime minister has around 86 people reporting to him. State-owned enterprises bleed roughly $1.5bn. “Jeff Bezos couldn’t run a team of 70 directly,” he says. The fix is privatisation where obvious, winding up the rest, and a one-time handshake to retool surplus staff — because lifetime employment plus defined-benefit pension, he argues, is a class of citizenship the factory owner paying corporate tax never gets.

Why he won’t buy the ‘run it ourselves’ argument

Muzamil puts the leftist counter to him — Taimur Rahman’s case that PIA and Steel Mills shouldn’t be sold off but repurposed, their people and assets redeployed the way Emirates and Qatar Airways scaled. Iqbal rejects it flatly, and reaches for history rather than ideology. The state-runs-everything model only delivers in a totalitarian system that can hoard all the talent, like China; Pakistan is not that, and never was. Bhutto’s nationalisation is his proof: healthy companies were nationalised, bailed out for years, then re-privatised — and the same banks now employ roughly three times the staff and pay tens of billions in tax. Steel Mills, still state-run, sits idle with production stopped. Government’s job, he says, is to enable productive capacity — education, healthcare, infrastructure, cheap power, cheap land — not to run businesses.

Pressed on who actually does the reform, he is honest that it probably won’t be voluntary. He expects “a few more experiments,” and a reckoning only when the lights go off. The instrument he keeps naming is a charter of economy — the big parties and the military sitting at one table, treating tax, agriculture, energy, and government size as the national-security issues they are, and trading the pain. Markets correct themselves, he says, including the market for narrative and the market for politics. The question is how bloody the correction gets.

The Gulf played its last oil hand well — Pakistan didn’t play at all

The conversation closes where it began, on the region around them. Iqbal’s read is that around 2016–17 the Gulf states looked at two resources — cash and population — and decided to monetise oil hard while repurposing the proceeds before the era ends. They cut handouts, raised power prices, and pulled their best Saudi talent into government and economic strategy. In Careem, he notes, 90% of Saudi captains were expats in 2017; today they are entirely Saudi, and the airport retail that ran on Filipino staff now runs on Saudi staff.

Then they turned outward for talent. He describes a venture fund, Antler, running a Dubai-and-Saudi programme that took 23 founders from 3,000 applications — including a key figure from Ukraine’s satellite programme and Iranian founders whose companies couldn’t exit at home. Expo and the Qatar World Cup, he argues, showed a region that had moved from rivalry to coordinated competition. They are emerging as a hub of talent, capital, and geopolitical leverage — a kingmaker on the margin.

Against that, Pakistan’s position is stark. In the decoupling of globalisation and the slow reshuffle of the dollar’s reserve status, Pakistan is not a player but a recipient — kept afloat, Iqbal says, mainly because a nuclear-armed, fifth-most-populous state failing is in nobody’s interest, not even its enemies’. The IMF tranche, the minerals, the oil — all band-aids, never silver bullets. The work doesn’t change with the government that does it. Tax, agriculture, energy, government size: reform them, free the fiscal space, put it into education, healthcare, and infrastructure. Get the unit economics positive first. Pakistan turns 100 soon, he says, and the only real question is which country it wants to be when it does.