Defence
Economy & Fiscal Outlook
Pakistan’s Economic Survey for FY25, published in early June, projects GDP growth at 2.7%, up marginally from 2.5% in FY24 but still trailing the initial 3.6% target. The International Monetary Fund (IMF) forecasts 2.6% for FY25 and 3.6% for FY26 . Key factors include a robust current-account surplus of $1.9 billion (July–April), compared to a $200 million deficit last year. The State Bank reduced interest rates to 11% to stimulate growth.
Despite these gains, Pakistan’s total debt surged to around PRs 76 trillion (≈ $87.4 billion), with debt servicing consuming over 1.9% of GDP . With defence spending still rising, balancing economic stability and national security remains a demanding tightrope. The upcoming FY26 budget—set to debut around 10 June—will be a litmus test of fiscal discipline and reform ambition. Economy & Fiscal Outlook
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Defence Posture & Arms Deals
While grappling with fiscal constraints, Pakistan is poised to expand its defence budget, a decision clearly prioritised in the Economic Survey despite debt concerns . Notably, Pakistan reportedly intends to purchase China’s J‑35 stealth fighter jets, marking the aircraft’s first international sale. The announcement triggered a rally in Chinese defence stocks, with AVIC Shenyang leading a >10% jump .
Defence
Amid rising geopolitical tensions across South Asia, Pakistan’s military posture has grown more assertive. Former Foreign Minister Bilawal Bhutto‑Zardari cautioned that the threshold for India‑Pakistan war “has never been lower”—a sign that strategic anxieties remain acute. Defence Posture & Arms Deals
Diplomacy & International Role
Pakistan sought and secured the chairmanship of the UN Security Council’s 1988 Taliban Sanctions Committee. However, Islamabad’s aspirations to head multiple UN terror‑related panels were mostly rebuffed. The outcome underscores both Pakistan’s desire to shape counter‑terrorism frameworks and the constraints posed by perceptions of its international credibility.
Defence
On another diplomatic front, Pakistan and Afghanistan agreed to restore ambassadorial ties in Beijing, mediated by China. Kabul also expressed interest in joining the China‑Pakistan Economic Corridor (CPEC). While Pakistan prioritises border stability, China gains a stronger regional footprint. Diplomacy & International Role
Regional Tensions & Security Alerts
Former FM Bhutto‑Zardari’s warning about a low nuclear war threshold reflects ongoing strains with India . Meanwhile, Islamabad is engaging U.S. lawmakers for support, highlighting Pakistan’s multi‑vector diplomatic outreach, particularly after recent border flare‑ups . Pakistan continues to press for a joint investigation forum to probe trans‑border terrorism concerns. Regional Tensions & Security Alerts
Tragic Crime & Social Impact
A horrific incident shook the nation: Islamabad‑based 17‑year‑old TikTok influencer Sana Yousaf—a rising voice for women’s rights—was murdered by a rejected follower at her home. The suspect allegedly entered forcibly, shot her, stole her phone, and fled. Authorities later arrested him, citing “gruesome and cold‑blooded” motives . The brutal killing sparked national outrage, calling attention to online misogyny and the vulnerabilities faced by female social‑media activists. Tragic Crime & Social Impact
Defence
Cultural & Sports Updates
The Pakistani film industry launched Deemak, a horror‑drama featuring Faysal Quraishi and Sonya Hussyn, released on Eid Al‑Adha (6 June) . Additionally, former pacer Aaqib Javed announced ambitious reforms for the National Cricket Academy in Lahore, aiming to elevate it to world‑class standards . On the field, the 2025 Pakistan Super League (PSL X) concluded on 25 May, with Lahore Qalandars securing their third title. Cultural & Sports Updates
Defence
Infrastructure & Environment
Though not front‑page in June, the Cholistan Canal Project—a flagship of Punjab’s Green Pakistan Initiative—continues to spark controversy. Critics in Sindh warn this new irrigation scheme will deplete Indus River flows, threatening millions in the Indus Delta. The project includes six canals aimed at reclaiming 4.8 million acres of marginal land. Infrastructure & Environment
Defence
Broader Implications
- Economic Future: Marginal growth offers relief but debt and defence outlays may drag budgets and inflation.
- Security Dynamics: Pakistan’s military upgrades and tensions with India maintain a fragile peace.
- Regional Strategy: China’s role in mediating Kabul ties and facilitating arms sales solidifies its strategic position.
- Human Rights & Society: The Sana Yousaf case spotlights a grim undercurrent: overlapping social media’s influence with personal risk. Broader Implications
Defence
Conclusion
June 2025 marks a defining chapter in Pakistan’s political, economic, and strategic journey. The country faces a delicate balancing act: managing economic recovery amid mounting debt, investing in military upgrades amid persistent regional tensions, and navigating diplomatic aspirations on the global stage.
Defence
While modest GDP growth and a current-account surplus offer some optimism, soaring debt and defence spending raise red flags for long-term sustainability. Meanwhile, Pakistan’s deeper ties with China—whether through fighter jet deals or diplomatic mediation—signal a recalibration of alliances. Internally, tragic events like the murder of TikTok star Sana Yousaf expose social fractures and the urgent need for policy reforms around digital safety, gender equity, and law enforcement.
Defence
The road ahead for Pakistan will require strategic foresight, economic discipline, and social resilience. Whether it can convert current challenges into a foundation for stability and inclusive growth remains to be seen—but the decisions taken in this period will echo for years to come.
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