Pakistan’s Finance Minister Muhammad Aurangzeb has cautioned that unchecked population growth and worsening climate conditions are two of the biggest challenges preventing the country from achieving its economic goal of becoming a $3 trillion economy. Speaking on Geo News’ program Capital Talk, the minister underscored that these issues are no longer distant threats but immediate realities impacting the country’s development trajectory and social stability.
According to World Bank data, Pakistan’s population now exceeds 251 million, growing at a rate of about 2.55 percent annually as of 2023. Despite this rapid expansion, approximately 45 percent of citizens continue to live below the poverty line. Combined with the growing burden of climate change, these trends are straining national resources, hindering economic productivity, and deepening inequality across regions.
Aurangzeb emphasized that climate change has moved beyond theoretical debate and now manifests through tangible crises, such as worsening smog conditions in Lahore and the devastating floods that have repeatedly struck large areas of the country. “We have two existential issues because if we don’t tackle them correctly, they could derail us from becoming a $3 trillion economy, and those are climate change and population growth,” he said.
He warned that the frequency and intensity of extreme weather events were increasing, highlighting that recent floods caused widespread losses—both in human lives and economic output. The finance minister revealed that 80 percent of the damage from the latest floods occurred in Punjab, primarily impacting key agricultural sectors including rice and cotton production. This has already prompted a downward revision in the country’s growth projection, trimming at least 0.4 to 0.5 percent from the current fiscal year’s 4.2 percent growth target.
Aurangzeb noted that Prime Minister Shehbaz Sharif has tasked Climate Change Minister Musadik Malik with preparing a comprehensive 300-day action plan to address environmental vulnerabilities and adapt to climate risks. He said this framework would focus on sustainable infrastructure, disaster preparedness, and agricultural resilience to safeguard the economy from further disruptions.
When asked about the recent exodus of multinational companies from Pakistan, the finance minister said such decisions often align with global corporate strategies rather than domestic factors alone. He cited the example of the Royal Bank of Scotland’s exit, noting that it was part of a worldwide retreat from specific markets. Aurangzeb acknowledged that while some global firms, including Shell, Procter & Gamble, and Eli Lilly, have scaled down operations in recent years, others such as Aramco have entered the Pakistani market, signaling continued investor interest.
The broader concern, however, remains Pakistan’s weakening manufacturing sector. Data from the Pakistan Bureau of Statistics reveals that over half of the products monitored under the Large Scale Manufacturing index have seen an annual decline of around 10 percent over the past two years.
Meanwhile, former finance minister Miftah Ismail, speaking in a separate interview on Aaj Shahzeb Khanzada Kay Sath, echoed concerns about structural weaknesses in Pakistan’s economic model. While acknowledging that stability has been restored, he argued that the lack of meaningful reforms, unchecked government spending, and high taxation have suppressed demand and discouraged investment. Ismail stressed the need for the government to streamline its operations and allow the private sector more room to drive growth.
He also called for a comprehensive overhaul of the country’s energy infrastructure, advocating for greater adoption of renewable sources such as solar and wind to bring down production costs and attract foreign investors.
Both finance experts agreed that Pakistan’s long-term prosperity hinges on urgent policy reforms, population control initiatives, and aggressive climate adaptation measures. Without decisive action, the nation’s ambition of reaching a $3 trillion economy could remain out of reach amid rising environmental and demographic pressures.
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