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Roadmap to Self-Sustainability

Huzaima Bukhari & Abdul Rauf Shakoori

Since its inception, Pakistan has been facing a series of challenges. Right after the mysterious death of Quaid-e-Azam Muhammad Ali Jinnah, followed by assassination of the first Prime Minister Liaqat Ali khan, a political turmoil and vacuum were created—these persist till today and remain unaddressed as evident from the ongoing political impasse. In its early years, the power game between different players added further to political instability which culminated in abrogation of the Constitution by General Ayub Khan, who became Martial Law Administrator and Field Marshal. His desire to remain in power further deteriorated the institutions of the country that were in infancy. His legacy of using institutions to benefit his regime damaged the fabric of state increasing grievances of both provinces and public. His government kept on ignoring burning issues and eventually during the tenure of his successor, we lost half of the country—East Pakistan declared independence emerging as Bangladesh.

It is an unfortunate fact that ruling elites of Pakistan have been busy securing their power and the political forces also remained under the influence of dictators, the culture of discouraging dissenting voices is very old and the country has witnessed worsening law and order situation, religious intolerance, and political instability. Pakistan’s judiciary, which is bestowed with the responsibility of upholding the constitution and dispensing justice, has also failed to perform accordingly. Their role in key matters has always been questionable attracting criticism from independent experts starting from Maulvi Tamizuddin’s case to Zulfikar Ali Bhutto’s controversial trial. The ouster of three-times elected Prime Minister for not withdrawing salary from his son’s company, and a legacy of justifying unconstitutional actions of dictators allowing them to amend the constitution, are well-known anecdotes. During last decade, the power of suo moto was widely used and allegedly abused, selectively, and/or whimsically—thus started a new chapter in judicial history which is now remembered as undesirable form of judicial activism. This created chaos in the country, government and its institutions became ineffective—in some cases even dysfunctional.

Even matters like foreign investment were taken cognizance of in utter disregard of international law, ignoring rights of investors. Resultantly, Pakistan faced international embarrassment and suffered huge financial losses. In the Reko Diq case, Pakistan was slapped with US$ 6 billion penalty, whereas in the Karadeniz Elektrik Uretim A.S case, the International Centre for Settlement of Investment Disputes (ICSID) Tribunal disagreed with the findings of our Supreme Court and concluded that there was no specific corruption. Likewise, the National Accountability Bureau (NAB) was taking actions against businessmen, politician and bureaucrats—merely on conjectures and/or randomly. People have been kept behind bars for several months without any charge or conviction.

Our economy and businesses have already been impacted by “War on Terror” where Pakistan lost more than eighty thousand human lives, besides the economy suffering losses to the tune of nearly US$ 123 billion.  All these factors have added fuel to political and economic instability and Pakistan has never been taken seriously as investment friendly country by local and foreign investors.

In view of the above, the only way forward for making Pakistan a self-reliant and financially sound country is by ensuring political stability, upholding supremacy of the constitution, implementing fundamental rights and providing friendly business environment in order to win the confidence of investors.

From 2013 to 2018, Pakistan witnessed a good spell of growth—on average, economic performance remained robust and there was a continuous growth trajectory. Key indicators were largely satisfactory, especially GDP that reached its highest level. Inflation and currency devaluation remained within acceptable/endurable levels. However, parallel fiscal and external imbalances emerged, that amortized macroeconomic stability gains and after departure of regime in 2018, the external account deteriorated sharply due to a widening trade deficit. The challenges remained the same during August 2018 to March 2022—GDP growth lost its pace, inflation was on a constant rise and currency on a constant slide. The chronic issue of the current account deficit, even after the events of April 3. 2022, is persisting and remains unaddressed—going beyond control with each passing day. 

Pakistan needs to work upon its trade potential with leading global partners, as its share of exports in global markets is shrinking. We can address most of the challenges emerging out of deficient foreign reserves through better value-added exports and import-substitution. We need to find new avenues/opportunities. For example, the World Bank’s publications state that Pakistan’s agricultural exports are chiefly directed to low-and-middle-income countries—mainly to Afghanistan and the Middle East. In order to increase the volume of exports, we have to focus on creating trade opportunities around the globe to increase exports. We must also concentrate on industries helping to import-substitution. Further, signing facilitation agreements with key economies around the world is a need of the hour. It will help in entering new markets and at the same time helps to integrate and upgrade our markets with global standards.

Key initiatives which need to be taken include liberalization of tariffs to facilitate import-based inputs of items that are to be exported. However, in long run, Pakistan needs to work on strong integration where essential and quality input is available locally. Additionally, we need to minimize the time, cost, and documentation required to process exports.

The government of Pakistan needs to invest in trade facilitation reforms, improve logistics policies, and enhance infrastructure. As per World Bank’s publications, Pakistan’s ranking on the Logistics Performance Index slid from 110th in 2010 to 122nd in 2018. Pakistan needs to take full advantage of the landmark China Pakistan Economic Corridor (CPEC) initiative. This relationship should lead to free trade agreements and secure preferences for high potential products from Pakistan such as textiles, hides and skins, leather items, agricultural products, etc.

The world is fast evolving into a global village, and with faster means of communication, the distances are becoming less relevant. The supply chains around the world are integrated in a way that people have no access to markets and products across the world with minimum complexities of global trade. Pakistan needs to work on the overall, fast-emerging e-commerce legislative framework and should take steps to train and facilitate people in this field. This can help in overcoming the challenges of unemployment and poverty and will also help in generating foreign exchange.

For higher domestic revenue mobilization, the Federal Board of Revenue and provincial tax authorities need to collaborate with each other or merge into a single tax authority—this will help in reducing the menace of tax evasion and avoid instances of double taxation. Though, the government has started working on this, however, it needs to expedite to attain the desired results. Our parliamentarians must provide a comprehensive framework which can revamp the taxation system in Pakistan in totality. There is a dire need to modernize the way in which revenue collection bodies operate, the policy formulation, implementation and execution. The framework should be designed in a way that it efficiently provides service to public and equally protect the financial interests of the state. Unless all the above initiatives are seriously undertaken and successfully implemented, as elsewhere in the world, we cannot embark on the road to self-sustainability, what to speak of achieving it.


Ms. Huzaima Bukhari, MA, LLB, Advocate High Court, Visiting Faculty at Lahore University of Management Sciences (LUMS), member Advisory Board and Visiting Senior Fellow of Pakistan Institute of Development Economics (PIDE), is author of numerous books and articles on Pakistani tax laws. She is editor of Taxation and partner in Huzaima & Ikram, and Huzaima, Ikram & Ijaz, leading law firms of Pakistan. From 1984 to 2003, she was associated with Civil Services of Pakistan. Since 1987, she has been teaching tax laws at various institutions including government-run training institutes in Lahore. She specialises in the areas of international tax laws, ML/CFT related laws, corporate and commercial laws. She is co-author and review editor for many publications of International Bureau of Fiscal Documentation (IBFD).

She has coauthored with Dr. Ikramul Haq many books that include  Tax Reforms in Pakistan: Historic & Critical Review, Towards Flat, Low-rate, Broad and Predictable Taxes (revised & Expanded Edition, Pakistan: Enigma of Taxation, Towards Flat, Low-rate, Broad and Predictable Taxes (revised/enlarged edition of December 2020), Law & Practice of Income Tax, Law , Practice of Sales Tax, Law and Practice of Corporate Law, Law & Practice of Federal Excise, Law & Practice of Sales Tax on Services, Federal Tax Laws of Pakistan, Provincial Tax Laws, Practical Handbook of Income Tax, Tax Laws of Pakistan, Principles of Income Tax with Glossary andMaster Tax Guide, Income Tax Digest 1886-2011 (with judicial analysis).

She regularly writes columns/articles/papers for Pakistani newspapers/journals and international journals/magazines and has contributed over 1700 articles on issues of public finance, taxation, economy and on various social issues in various journals, magazines and newspapers at home and abroad.


Abdul Rauf Shakoori, BA, LLB, LLM, Advocate High Court, is a subject-matter expert on AML-CFT, Compliance, Cyber Crime and Risk Management. He has been providing AML-CFT advisory and training services to financial institutions (banks, DNFBPs, Investment companies, Money Service Businesses, insurance companies and securities), government institutions including law enforcement agencies located in North America (USA & CANADA), Middle East and Pakistan. His areas of expertise include legal, strategic planning, cross border transactions including but not limited to joint ventures (JVs), mergers & acquisitions (M&A), takeovers, privatizations, overseas expansions, USA Patriot Act, Banking Secrecy Act, Office of Foreign Assets Control (OFAC).

Over his career he has demonstrated excellent leadership, communication, analytical, and problem-solving skills and have also developed and delivered training courses in the areas of AML/CFT, Compliance, Fraud & Financial Crime Risk Management, Bank Secrecy, Cyber Crimes & Internet Threats against Banks, E–Channels Fraud Prevention, Security and Investigation of Financial Crimes. The courses have been delivered as practical workshops with case study driven scenarios and exams to insure knowledge transfer.

His notable publications are: Rauf’s Compilation of Corporate Laws of Pakistan, Rauf’s Company Law and Practice of Pakistan and Rauf’s Research on Labour Laws and Income Tax and others.

His articles include: Revenue collection: Contemporary targets vs. orthodox approach, It is time to say goodbye to our past, US double standards. Was Due Process Flouted While Convicting Nawaz Sharif?, FATF and unjustly grey listed Pakistan, Corruption is no excuse for Incompetence, Next step for Pakistan, Pakistan’s compliance with FATF mandates, a work in progress, Pakistan’s strategy to address FATF Mandates was Inadequate, Pakistan’s Evolving FATF Compliance, Transparency Curtails Corruption, Pakistan’s Long Road towards FATF Compliance, Pakistan’s Archaic Approach to Addressing FATF Mandates, FATF: Challenges for June deadline, Pakistan: Combating the illicit flow of money, Regulating Crypto: An uphill task for Pakistan. Pakistan’s economy – Chicanery of numbers. Pakistan: Reclaiming its space on FATF whitelist. Sacred Games: Kulbhushan Jadhav Case. National FATF secretariat and Financial Monitoring Unit. The FATF challenge. Pakistan: Crucial FATF hearing. Pakistan: Dissecting FATF Failure, Environmental crimes: An emerging challenge, Countering corrupt practices .


The recent book, coauthored by these writers with Dr. Ikramul Haq, is Pakistan Tackling FATF: Challenges & Solutions , available at:  https://www.amazon.com/dp/B08RXH8W46  and https://aacp.com.pk/


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