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Pakistan: An economy on life support, strained by debt and weak reforms

Faces shaky recovery amid renewed tensions with India, surging debt, IMF dependence, weak reforms, and chronic structural and governance failures. SHIKHA CHATURVEDI & JAYANT PANKAJ explain

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Pakistan's foreign exchange reserves remain volatile, while high energy import costs, a narrow export base, and structural inefficiencies across agriculture and industry continue to exert pressure. (Photo: Shutterstock)

Shikha Chaturvedi Jayant Pankaj Delhi

4 min read Last Updated : May 12 2025 | 12:25 AM IST

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Pakistan is currently teetering on the edge of a fragile economic recovery, weighed down by tensions with India and deepening fiscal dependence on international lenders.

Hostilities with India reignited following a terrorist attack on April 22 in Jammu & Kashmir’s Pahalgam, in which 26 people, mostly tourists, were killed. India has since appealed to international financial institutions to reassess their support for Pakistan, citing Islamabad’s complicity with terrorist groups. These renewed frictions have intensified scrutiny over Pakistan’s economic management and its recurring reliance on bailouts from the International Monetary Fund (IMF).

Pakistan’s latest conflict with India has emerged amid

Topics : Pakistan economy IMF International Monetary Fund Operation Sindoor