ISLAMABAD – June 19: Prime Minister Shehbaz Sharif has described the intensifying conflict between Iran and Israel as “deeply alarming,” cautioning that the escalating violence threatens both regional stability and global peace.
Chairing a federal cabinet meeting on Wednesday, the prime minister reaffirmed Pakistan’s unwavering solidarity with Iran in the face of Israeli aggression and urged the international community to intervene immediately.
“The world must act now to bring about a ceasefire,” PM Shehbaz said. “Pakistan stands in full support of our brotherly nation, Iran.”
He shared that he had conveyed condolences and Pakistan’s solidarity to Iranian President Masoud Pezeshkian, and also discussed the growing regional crisis with Turkish President Recep Tayyip Erdogan.
Addressing the humanitarian catastrophe unfolding in Gaza, the premier condemned the continued violence, pointing out that more than 50,000 Palestinians had lost their lives. “The scenes from Gaza are heart-wrenching,” he said. “The scale of brutality is shocking—how long will the global conscience remain asleep?”
Foreign Minister Ishaq Dar is expected to represent Pakistan at the upcoming Organisation of Islamic Cooperation (OIC) foreign ministers’ meeting in Türkiye on June 21–22, where the ongoing crises in Gaza and the Middle East will be key topics.
Domestic Agenda: Budget, Defence, and Energy Reform
Turning to domestic affairs, PM Shehbaz praised the fiscal year 2025 budget, highlighting successful negotiations with the International Monetary Fund (IMF) to protect the agriculture sector from new taxation.
He noted that income tax for the Rs600,000–1.2 million bracket had been slashed from 5% to 1%, and that Rs1 trillion had been earmarked for the Public Sector Development Programme (PSDP) to spur economic growth and infrastructure development.
The prime minister also acknowledged the armed forces’ role in the recent military standoff with India, calling the outcome a “significant victory” and affirming that defence allocations had been increased to support ongoing counterterrorism efforts.
Commending Pakistan’s international diplomacy, PM Shehbaz credited Foreign Minister Bilawal Bhutto Zardari and Senator Sherry Rehman for effectively communicating Pakistan’s position on India’s “unilateral and illegal actions” during their recent visits to the U.S. and Europe.
Power Sector Revamp: Tackling Circular Debt
In a landmark decision, the federal cabinet approved a sweeping financial strategy to eliminate Pakistan’s circular debt—valued at Rs1,275 billion ($4.6 billion)—in what officials are calling the country’s most ambitious energy reform to date.
The plan includes refinancing Rs683 billion in debt held by the Power Holding Company and settling outstanding payments to Independent Power Producers (IPPs). The remaining obligations will be addressed through institutional reforms and structural changes in the energy sector.
“This is a critical step toward restoring financial viability and investor confidence in Pakistan’s energy sector,” a government statement said. “The circular debt will be eliminated over the next six years without adding pressure to the national budget.”
Officials described the move as a major milestone in energy sector reform, signalling the government’s commitment to sustainable solutions and fiscal stability.
