💸 Debt, 💻 Digital, 🧭 Direction

Another Week, Another Pulse!

It was a week of contrasts — celebrations of Independence Day lit up parts of the country, while elsewhere cloudbursts and flash floods brought distress. On the economic front, however, there was reason for optimism. Moody’s upgraded Pakistan’s credit rating from Caa2 to Caa1 with a stable outlook, citing improved financial strength backed by IMF support. The government also offered relief at the pump, slashing high-speed diesel (HSD) prices by Rs. 12.84 per litre. Adding to the headlines, Federal Minister for Maritime Affairs Muhammad Junaid Anwar Chaudhry announced that Pakistan’s ports are on the path to digitalization, with AI integration promised by August 14.

Looking ahead, Federal Finance Minister Muhammad Aurangzeb confirmed that an IMF delegation will visit Pakistan at the end of September, a development that will be closely watched given the country’s ongoing economic reforms and commitments under the IMF program.

In an unusual revelation, an audit report disclosed that Pakistan is still owed more than $304.5 million by Sri Lanka, Bangladesh, Iraq, Sudan and Guinea-Bissau. These dues date back to export credit extended during the 1980s and 1990s and, when converted, amount to over Rs. 86 billion today. The disclosure has drawn attention to decades-old financial exposures that remain unsettled, raising concerns about recovery and accountability.

Adding to the challenges, the International Monetary Fund has raised concerns over Pakistan’s capacity to effectively identify politically exposed persons (PEPs) and curb corruption, pointing to uneven implementation of safeguards and inadequate red-flag indicators. 

Here’s your five-minute recap for everything you need to know.

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In the shortened four-day trading week, the Pakistan Stock Exchange (PSX) sustained its upward trajectory, with the KSE-100 Index setting a new record high of 147,005 points. The index ultimately closed the week at 146,492, posting a gain of 1,109 points or 0.76% on a weekly basis. The rally was driven by strong corporate earnings, Moody’s upgrade of Pakistan’s sovereign rating to Caa1, and optimism over a decline in circular debt in the power sector. However, profit-taking toward the end of the week capped further gains, with the final session closing nearly flat, slipping by 37.67 points to settle at 146,491.63.

NCCPL to implement T+1 settlement cycle from February 2026

The National Clearing Company of Pakistan (NCCPL) has announced that from February 9, 2026, all stock trades will be settled on a T+1 cycle, meaning payments and deliveries will be completed just one day after a trade instead of two. This change is a major step in modernizing Pakistan’s capital markets, making transactions faster, reducing risk, and improving investor confidence. Over the next year and a half, regulators and brokers will prepare their systems for the transition, which is expected to attract more foreign investment and bring Pakistan closer to international market standards.

Pakistan Fulfills Another IMF Condition

Pakistan has met another IMF condition by deciding to extend the repayment timelines for its loans. The average maturity period for domestic debt will be increased from about 3.8 years to 4.3 years, while foreign loan repayments will be stretched from 6.1 years to 6.3 years by 2028. This move is designed to ease pressure on the country’s finances, reduce short-term borrowing needs, and give the government more breathing space. Work on this new debt management strategy has already begun and progress will be shared with the IMF in the next economic review.

Digital wallets surge as govt pushes for cashless Pakistan

The government has launched an ambitious plan under the Prime Minister’s Cashless Economy initiative to speed up digital payments and fintech adoption. Targets include expanding active digital merchants to 2 million by 2026, increasing mobile and internet banking users from 95 million to 120 million within a year, and doubling annual digital transactions to 15 billion. Another key goal is to route all overseas remittances through bank accounts or mobile wallets, up from the current 80 percent. The State Bank of Pakistan will play a central role in driving this shift and expanding mobile banking access nationwide.

Investments in T-bills Dip as Sentiment Weakens

Foreign investors pulled out $49 million from Pakistan’s treasury bills (See Historical Data📈) in July, the first month of FY26, while fresh inflows dropped to just $13 million. Most of the activity came from the UK, with small outflows from the UAE and little new investment overall. Analysts say the sell-off reflects weak investor confidence as falling interest rates make T-bills less attractive. With yields now around 11 percent compared to much higher returns last year, sentiment remains cautious despite signs of economic stability.

Govt to Launch Real-Time Digital Tracking of Petroleum Products

The government will introduce a real-time digital tracking system for petroleum products within a month to curb smuggling, theft, and adulteration. Backed by the newly passed Petroleum (Amendment) Act 2025, the system will monitor fuel from import and production all the way to storage, transport, and sale, aiming to plug annual revenue losses of Rs. 300–500 billion. The updated law replaces provisions from the 1934 Petroleum Act and gives enforcement powers to commissioners and customs officials to seize smuggled or illegally stored fuel. Ogra, working with industry stakeholders, is finalizing the technical rollout, which will provide end-to-end visibility of the entire supply chain.

5G is Coming Soon and Satellite Internet Will Follow: PTA

PTA Chairman Major General (Retd) Hafeez ur Rehman has confirmed that Pakistan is preparing to roll out 5G services soon, with satellite internet expected to follow. Speaking at a cybersecurity workshop, he highlighted that while countries like China are already exploring 6G, Pakistan’s immediate focus is on introducing 5G and strengthening public trust through robust digital measures.

When planning for retirement, many suggest starting with an equity VPS (Voluntary Pension Scheme), but few highlight the key factors you should consider before choosing the right fund. Two of the most important are the Total Expense Ratio (TER) and the Management Fee.

• TER (Total Expense Ratio): This is the total annual cost of running a fund, expressed as a percentage of its assets. It includes management fees, administration, and marketing costs.
  

• Management Fee: This is specifically what you pay the fund manager for managing your portfolio, and it’s included within the TER.
  

What really matters to you as an investor is the net return—what you actually take home after costs.

Example: ABL Pension Fund – VPS Equity

If you had invested Rs. 100,000:

• 1-Year Gross Return: 86.55% → Rs. 186,550
  

• Management Fee: 1.5%
  

• TER: 2.2% (approx.)

After fees, your net return would be slightly lower, around 84%, leaving you with ~Rs. 184,000 instead of Rs. 186,550.

This shows why it’s essential to compare not just the returns, but also the costs before selecting your retirement fund.

Below, we’ve compiled 1-year and 3-year returns along with each fund’s TER and management fee for a clear side-by-side comparison.

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