Former finance minister and renowned economist Dr Hafiz Pasha has warned that the recent surge in terrorism poses a significant threat to Pakistan’s economy.

Speaking on Aaj TV’s programme “Spotlight” with host Munizae Jahangir, he said that while Pakistan’s foreign exchange reserves now exceed $11 billion and the country is no longer at risk of default, economic challenges persist due to a decline in fresh inflows of capital.

He emphasised that this situation is particularly detrimental to foreign investment, including that from China.

Dr Pasha pointed out that despite numerous agreements signed by the government with other countries, there has been little to no impact on the national economy.

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He noted that Pakistan’s economic growth rate has plummeted to 1% while the fiscal shortfall continues to widen.

He also criticised the government’s economic data, stating that official figures do not accurately reflect ground realities.

“Electricity and wheat prices have increased, yet the government claims otherwise,” he said.

However, he highlighted that a drop in global oil prices would be beneficial for Pakistan and other nations, as it could help reduce inflation and provide much-needed relief to the public.

The former finance minister further noted that Pakistan’s property sector remains largely untaxed, stressing the need for higher property taxation.

He also highlighted the ongoing crisis in the textile industry, revealing that over 100 textile mills have shut down due to declining profitability.