AGP Executive Report

Budget 2026-27 in Focus: Pakistan’s federal budget for FY2026-27 is set for presentation in the National Assembly today, with sources pointing to a Rs15.267tr tax target, Rs7.824tr for debt servicing, defence around Rs3tr, and a petroleum levy target of Rs1.727tr—while the public watches for relief versus new burdens. PIA Privatisation Milestone: President Asif Zardari has approved the Pakistan International Airlines (Conversion) (Repeal) Bill 2026, completing legal formalities for the Arif Habib-led consortium’s 75% stake purchase. Regional Diplomacy Under Strain: Pakistan says it is actively mediating amid US-Iran tensions and warns that dialogue is the only path to stability as the Strait of Hormuz dispute and deal talk remain unsettled. Indus Water Warning: Islamabad tells India any move to block Indus flows would be treated with utmost seriousness, even as an “act of war,” raising stakes for regional peace. Kashmir Flashpoint: PoK continues to draw international criticism after reports of civilian killings and crackdowns, with governance failures cited by rights voices. Public Services & Governance: Punjab ends temporary free transport on Lahore’s Orange Line and Speedo buses; Islamabad appoints Kainat Azhar as the capital’s first woman Chief Traffic Officer. Socio-Economic Reality Check: The Economic Survey flags rising poverty to 28.9% and falling education spending, while also noting youth potential that still isn’t translating into jobs. Security Tragedy: A Mi-17 helicopter crash in Pakistan-administered Kashmir killed 22 personnel; an inquiry is ordered. Sports & Soft Power: Pakistan’s IT and culture keep scoring—PMA wins top honours at Sandhurst’s Pace Sticking Competition, and Pakistan’s “Trionda” World Cup ball claim is fact-checked amid global attention.

Pakistan Economy & Budget: Finance Minister Muhammad Aurangzeb unveiled the Economic Survey 2025-26, saying GDP growth hit 3.7% in FY26, economy size crossed $452bn, and remittances are set to top $41bn, even as the budget is expected to squeeze the middle class under IMF-linked austerity. Railways Reform: PM Shehbaz approved a strategic roadmap to overhaul Pakistan Railways, pushing digitisation, track upgrades, service improvements and private-sector participation, with freight prioritised. Housing Push: Shehbaz ordered faster processing and simpler procedures under the Apna Ghar loans, with banks told to speed up eligible approvals. Security & Kashmir Tragedy: Pakistan Army Mi-17 helicopter crash near Muzaffarabad killed all on board; funeral prayers held in Rawalpindi with full military honours. Afghanistan Fallout: UN and Taliban-linked claims keep pressure on Islamabad after reports of civilian deaths in Pakistani airstrikes; meanwhile, Afghanistan-Pakistan Track 1.5 talks in Istanbul continue amid renewed tensions. Water Standoff: FO warned India that blocking Indus waters would be treated as an “act of war” after Indian minister remarks about stopping “not a single drop.” Regional Defence & Diplomacy: Turkish Land Forces commander met Pakistan’s top military leadership on defence cooperation; Oman-Pakistan Friendship Association announced in Muscat. Markets & Governance: SECP said PSX performance improved sharply, while a proposed 28th constitutional amendment is being debated over fears of centralising power.

Afghanistan-Pakistan Tensions: Pakistan launched fresh airstrikes in eastern Afghanistan (Khost, Kunar, Paktika), with Kabul and UN bodies citing civilian deaths and injuries while Islamabad says it hit militant targets, reigniting border tensions after a month of relative calm. Kashmir Flashpoint: A Pakistan Army Mi-17 helicopter crash near Muzaffarabad killed all onboard, as PoK unrest continues and Pakistan’s security posture reportedly shifts toward tougher measures. Budget 2026-27 Power Struggle: Finance Minister Aurangzeb presented the Economic Survey 2025-26 to PM Shehbaz; analysts say the budget’s direction is shaped by IMF-linked benchmarks, FBR revenue targets, and provincial bargaining. Tax Relief Debate: Reports suggest selective income tax relief for some salaried brackets in Budget 2026-27, alongside broader revenue measures. Gilgit-Baltistan Government Talks: PPP and PML-N held key talks in Gilgit on forming the next GB government, with proposals to be sent to central leaderships. Diplomacy & Narrative: Pakistan pushed inter-civilisational dialogue at the UN, while also rejecting India’s attempts to divert attention from occupied Kashmir. Public Sector Governance: Pakistan set up its first public sector Data Governance Council for the power sector to unify data and improve planning. Health & Social Services: Sehat Sahulat/PM National Health Program was relaunched in Islamabad, while health officials warned of rising diabetes among children. Sports Win: Pakistan beat Afghanistan 2-0 to lift the Diamond Jubilee football title in the Maldives, with PM Shehbaz and Tarar congratulating the team.

Pakistan-Afghanistan Cross-Border Escalation: Pakistan renewed airstrikes in Afghanistan’s Khost, Kunar and Paktika after attacks inside Pakistan, with Kabul saying 13 people were killed (including 11 children) and Pakistan claiming “precise” strikes killed 26 militants. PoK Unrest and Crackdown: Clashes in Pakistan-administered Kashmir followed the ban of JAAC, triggering shutdowns and internet blackouts; authorities also announced bounties and sedition proceedings against JAAC leaders. Military Tragedy in PoK: An Army MI-17 helicopter crashed near Muzaffarabad due to a technical fault during the ongoing protest/strike, killing all onboard; a board of inquiry has been ordered. Budget Countdown: The federal budget FY27 is set for June 12, with the Economic Survey 2025-26 due on June 11 and NEC finalising federal-provincial development plans. Governance and Services: Islamabad approved doorstep passport delivery with cashless processing; business hours were extended under energy-saving rules. Health and Justice: Punjab suspended three Services Hospital doctors over alleged manual medico-legal certificates; Pakistan’s Supreme Court acquitted two convicts in the Baldia Town factory fire case.

Afghanistan-Pakistan Clash: Pakistan’s airstrikes in eastern Afghanistan have killed at least 13 people, including 11 children, with 14 others wounded, as Kabul and the Taliban accuse Islamabad of bombing civilian homes in Khost, Kunar and Paktika—renewing fears of a wider border war after a fragile lull. Middle East Diplomacy: Pakistan urged restraint at the UN Security Council, calling for “peace a little more chance” as US-Iran tensions spike after a US Apache helicopter crash near the Strait of Hormuz and subsequent US strikes on Iran. PoK Unrest: Pakistan-administered Kashmir is in turmoil after the JAAC ban, with protests and clashes reported across Rawalakot and other areas, including reports of deaths and shutdowns. Federal Services: The government has finalized SOPs for doorstep passport delivery, aiming to reduce repeated office visits, with rollout expected after technical preparations. Budget Watch: Talks are underway on a major salaried-class tax relief package for FY2026-27, alongside extended austerity measures and revised grocery store timings. Economy & Finance: Remittances rose to $4.251bn in May; national savings scheme returns were increased ahead of the new fiscal year. Sports & Governance: PCB is set to reshuffle Pakistan’s Test setup after the Bangladesh series loss, while Pakistan named a 15-member Asian Games 2026 cricket squad. Transport Safety: A Lahore-bound train derailed in Sindh, killing at least one and injuring 40.

Kashmir Crackdown: Pakistan-administered Kashmir saw markets shut and protests erupt after the banned Joint Awami Action Committee called a strike; clashes in Rawalakot and elsewhere left multiple deaths, with authorities registering sedition cases and announcing bounties, while rights groups warn of internet blackouts and mass detentions. Parliament & Budget Timing: President Zardari approved National Assembly and Senate sessions for June 10 as the federal budget 2026-27 is expected in the coming days, with reporting pointing to a possible June 12 presentation. Security & Counterterrorism: Pakistan’s military and Interior Minister Mohsin Naqvi highlighted an intelligence-based operation in Balochistan’s Basima district killing 14 “Indian-sponsored” militants, alongside a separate fatal clash near Peshawar involving Federal Constabulary personnel. Migration Crackdown: FIA told a National Assembly committee that about 10,000 Pakistanis entered the UK on student visas and later sought asylum, alongside passport fraud and human-smuggling enforcement actions. Foreign Diplomacy: FM Ishaq Dar pressed Somalia for the early release of Pakistani seamen held hostage off Somalia. Pakistan-China Tech: A Pakistan-China Joint Research Centre was inaugurated at Shenyang University of Chemical Technology, expanding research links. Public Health: Lahore reported two new monkeypox cases, taking the city’s total to 54. Islamabad Civic Safety: A viral one-wheeling motorcycle stunt in Bahria Town Islamabad drew outrage and calls for action.

Middle East Mediation & Security: Pakistan’s PM Shehbaz Sharif urged restraint as Iran-Israel tensions eased after fresh exchanges, while US officials said talks are in the “final throes” of a peace deal. Defence Diplomacy: Pakistan’s Army chief Field Marshal Asim Munir met Lebanon’s commander Rodolphe Haykal at GHQ to expand defence cooperation amid the Lebanon crisis. UN Counterterrorism: Pakistan told the UNSC the Taliban must take “verifiable, non-reversible” action against Afghan-based militants, warning terrorism remains a threat; India hit back at Pakistan’s “Fitna al-Hindustan” narrative at the UN. Budget Countdown: Pakistan’s federal budget 2026-27 is now set for June 12 after further schedule shifts, with NEC talks and IMF-linked negotiations still ongoing. PoK Unrest: Clashes in Pakistan-administered Kashmir after a protest ban left at least 11 dead and 70+ injured as JAAC pushed for a region-wide shutdown. Economy & Markets: PSX jumped over 1,700 points on oil-price relief and budget optimism; trade deficit widened in FY26. Governance & Social: Islamabad’s “No Child Left Behind” enrolled 2,328 out-of-school children; SMEDA expanded grants for international SME accreditation.

Middle East Diplomacy: PM Shehbaz Sharif urged restraint as Iran-Israel tensions roiled again, saying peace talks with the US are nearing a “final objective” and warning of humanitarian fallout if violence continues. Regional Security & Mediation: Pakistan’s interior minister Mohsin Naqvi arrived in Iran amid fresh missile/drone exchanges in the Gulf, while Washington weighs using frozen Iranian assets—raising pressure on the ceasefire track. PoK Flashpoint: In Pakistan-administered Kashmir, clashes around a banned JAAC protest in Rawalakot left at least 11 dead and dozens injured as curbs and shutdown threats spread; Pakistan also rejected UK remarks on AJK, calling them interference. GB Elections Fallout: PPP led Gilgit-Baltistan election results in unofficial counts, but PTI rejected the outcome, alleging rigging and promising a white paper. Budget & Governance: President Zardari and PM Shehbaz met on security, the federal budget and regional issues; PPP signalled support for the 2026-27 budget after talks, while the budget presentation date is reportedly under review. Accountability & Public Policy: NAB vowed tougher anti-fraud steps, including publishing fraudsters’ photos in newspapers; OGRA dismissed LPG “expiry code” viral claims. Trade & Economy: Pakistan and Mauritius explored new trade opportunities as Pakistan’s trade deficit concerns linger, while sugar mills pressed for export approvals citing surplus.

Iran-US Mediation Under Strain: Pakistan’s interior minister Mohsin Naqvi arrived in Tehran as the Gulf crisis deepened, with Iran firing missiles/drones toward Bahrain and Kuwait and the US shooting down more Iranian drones near the Strait of Hormuz; Washington is also weighing ways to use frozen Iranian assets for Gulf war damages, while Israel struck Beirut’s southern suburbs days after a ceasefire. Market Jitters: PSX opened the week lower as Middle East escalation pushed oil prices up, raising worries over Pakistan’s external account and pre-budget uncertainty. Budget Politics: A proposed tax relief package is awaiting IMF approval ahead of FY27, including cuts for salaried taxpayers and Super Tax, while officials also weigh raising GST on items like solar panels and hybrid vehicles. AJK Crackdown and Elections: Clashes in Rawalakot in Pakistan-administered Kashmir left 7 dead as authorities sealed JAAC’s office and banned gatherings; meanwhile, AJK elections are reiterated as scheduled for July 27. GB Vote Dispute: PPP and PTI alleged irregularities in Gilgit-Baltistan election results, Form-45 issuance and withheld counts as unofficial results showed PPP leading. Security Operations: ISPR said 27 militants were killed in North Waziristan operations. Public Health & Food Safety: President and PM urged a safe, resilient food system on World Food Safety Day, while experts pushed for higher taxes on sugary drinks to fund nutrition reforms. Local Governance: Punjab announced an electric bike rental service in Lahore and issued heatwave alerts across the province. Women’s Rights Shock: Celebrities and the public reacted to Quetta’s acid attack on a doctor, now shifted to Karachi for treatment.

Iran-US War & Pakistan Mediation: With the Middle East conflict hitting its 100th day, the US says it shot down two more Iranian drones over the Strait of Hormuz while Iran warns escalation could follow Lebanon strikes; Pakistan’s Interior Minister Mohsin Naqvi is in Tehran delivering a “special letter” from Army Chief Asim Munir and PM Shehbaz to Iran’s Supreme Leader, as Washington weighs tougher steps including possible use of frozen Iranian assets. AJK Politics & Security: In Pakistan-administered Kashmir, the AJK top court protects 12 refugee-reserved seats ahead of elections, even as authorities detain JAAC supporters and ban the group under anti-terror laws; PPP leaders Bilawal Bhutto and others push for dialogue with Islamabad and PM Shehbaz to defuse the crisis. Budget Talks (PPP vs PML-N): PPP raised tax and Sindh development concerns in pre-budget meetings with DPM Ishaq Dar, who assured proposals would be incorporated in the FY2026-27 budget set for June 10. Counterterror Operations (KP): ISPR says security forces killed 27 militants in North Waziristan in intelligence-based operations, recovering weapons and ammunition. Water Crisis (Indus): Reports flag political friction between Punjab and Sindh over Indus water allocations, with acute shortages hitting canals like Dadu and worsening drought conditions. Humanitarian/Refugees: Deportees from Pakistan in Afghanistan say aid is inadequate, calling for housing and longer-term settlement support. Sports & Governance: NCA Lahore schedules red/white-ball camps under Sarfaraz Ahmed and Mike Hesson, while cricket and football updates continue alongside broader governance and public-policy debates.

US-Iran Mediation Push: Pakistan’s Interior Minister Mohsin Naqvi arrived in Tehran for high-level talks, carrying messages from PM Shehbaz Sharif and Field Marshal Asim Munir to Iran’s Supreme Leader, as Islamabad tries to revive a stalled US-Iran understanding amid fresh Gulf flare-ups. Gulf Reconstruction Funding Dispute: Reuters reports the US is weighing redirecting Iranian frozen assets to pay for reconstruction and repairs in Gulf states hit by Iran-linked attacks, a move that could further strain the fragile ceasefire. Hormuz Escalation: US forces shot down additional Iranian drones over the Strait of Hormuz and struck Iranian coastal radar sites, while Iran said the strikes broke the April 8 truce. GB Elections: Polling is underway in Gilgit-Baltistan for 24 seats with tight security; PPP and PML-N are seen as main rivals, while PTI alleges pre-poll rigging and external force deployment. AJK Crackdown: AJK police arrested 72 people linked to the banned JAAC ahead of planned protests, with the AJK government defending the ban under anti-terror laws. Money Laundering Case: FIA Lahore arrested four suspects in separate raids over alleged hawala/hundi and copyright violations, recovering Rs20.4m in cash and foreign currency. Food Safety Drive: President Zardari and PM Shehbaz urged stakeholders to strengthen safe food practices on World Food Safety Day. Karachi Water Crisis: JI staged protests over worsening water shortages, blaming repeated failures at key pumping stations and warning of wider action if relief is not provided.

Kashmir Crackdown: Pakistan-administered Kashmir police arrested dozens of supporters of the banned Jammu Kashmir Joint Awami Action Committee (JAAC) ahead of a planned Tuesday protest, after the AJK government proscribed the group under anti-terrorism laws; JAAC says it will not withdraw its march, while AJK PM Faisal Mumtaz Rathore says dialogue is possible only on unresolved issues. UN Diplomacy: Pakistan told the UN General Assembly that Indian Illegally Occupied Jammu and Kashmir “never was, neither is, and nor will ever be” integral to India, stressing the dispute remains on the UN Security Council agenda. Iran-US Mediation: Interior Minister Mohsin Naqvi arrived in Tehran for talks, meeting Iranian officials and carrying messages from Pakistan’s top leadership as Islamabad pushes new proposals to revive a US-Iran interim understanding amid renewed strikes. Lebanon Security: Lebanon’s army chief Rudolf Haykal left for Pakistan as Israeli strikes killed three Lebanese soldiers, with Pakistan positioned as a key mediator in the wider Iran-US-Lebanon talks. GB Elections: Gilgit-Baltistan votes for the Legislative Assembly on Sunday after a four-month delay; 24 constituencies, 396 candidates, and PTI alleges pre-poll rigging via heavy external security deployment. Karachi Waterfront Deal: Pakistan signed an MoU with Saudi and local partners to develop a 140-acre Karachi Port Trust waterfront maritime business district. Public Safety & Governance: Lahore police booked a contractor after a girl fell into an open manhole; authorities also stepped up monsoon and glacier-melt hazard preparations across Punjab and northern areas. Telecom Compliance: PTA warned citizens against illegal SIM transfers and identity misuse, saying misuse will be traced to registered owners.

Security & Counterterrorism: Pakistan’s security forces killed six terrorists in an intelligence-based operation in Balochistan’s Panjgur, with weapons, ammunition and IEDs recovered. UN Diplomacy (Kashmir): India and Pakistan traded sharp rebuttals at the UN Security Council/GA over Kashmir, with Islamabad rejecting New Delhi’s “baseless” claims and warning the dispute must be resolved through UNSC resolutions. Regional Security Cooperation (SCO): Interior Minister Mohsin Naqvi signed agreements with Russia and met SCO counterparts to boost cooperation against illegal immigration, narcotics trafficking and cyber threats, including focus on Afghanistan-based terrorist camps. Governance & Services (Islamabad): Islamabad’s district administration reviewed ACs and magistrates’ monthly performance, including price control, anti-encroachment and anti-dengue enforcement. Local Administration (NADRA): A NADRA centre in Lakarmar (Attock) is ready but stalled due to a political credit dispute between PML-N and PPP leaders. Economy & Policy: Planning Minister Ahsan Iqbal warned the NFC formula is squeezing federal fiscal space and floated shifting poverty-burden funding to provinces under the 18th Amendment. Public Order (Punjab): Punjab announced tight, approved-only security arrangements for Muharram processions, with permissions, routes and vetting required. Health/Regulation: Pakistan secured observer status at the global medicines regulator forum ICH, aiming to align DRAP with international standards.

Fuel & Cost Relief: Pakistan cut petrol by Rs4 to Rs377.78 per litre while keeping high-speed diesel unchanged at Rs380.78 for the next fortnight, continuing a weekly easing after earlier “Eid gift” reductions. AJK Security & Politics: Azad Jammu and Kashmir banned the Joint Awami Action Committee (JAAC) under the Anti-Terrorism Act, citing “terrorism” and “anarchy,” as the group still plans a June 9 protest amid AJK election preparations. Islamabad Governance: A 138-page reform proposal would create a 27-member elected local assembly for Islamabad with more financial and administrative autonomy, while law-and-order and master planning stay federal. Regional Security (SCO): Interior Minister Mohsin Naqvi urged Shanghai Cooperation Organisation members to coordinate against terrorism, cybercrime and terror financing, warning militants increasingly use AI and digital platforms. GB Elections Diplomatic Clash: Pakistan rejected India’s “baseless” protest over June 7 Gilgit-Baltistan polls, while India again lodged objections over the election and Kashmir claims. Local Governance & Law Enforcement: Lahore tightened entry rules for commercial vehicles, demanding valid driving licences, fitness certificates and proper lights, with checks at city entry points. Public Services Pressure: Karachi’s Qayyumabad saw protests and traffic disruption over a years-long water shortage, with residents alleging diversion of supply to other areas.

Balochistan Security Crackdown: Pakistan launched a large-scale military operation across Mastung, Kalat, Noshki, Kech, Khuzdar and Panjgur, with residents reporting casualties, arbitrary detentions and mobile/communication shutdowns, raising fresh human-rights alarms. Civic Space Under Pressure: A separate report says dissent is being increasingly criminalised—protests fade, journalists and activists face surveillance and arrests, and social media users are targeted for challenging official narratives. Gilgit-Baltistan Polls: Campaigning for June 7 GB elections enters the final stretch, with PPP and PML-N leaders trading claims of rigging and promising development and jobs; Bilawal also renewed calls for GB’s provincial status. Pakistan-Iran Border Talks: Interior ministers agreed to tighten border security and curb illegal cross-border activity after talks in Dushanbe. Tax Tech in Islamabad: PM Shehbaz ordered a pilot of an AI-driven automated tax collection system in the federal capital, aiming to reduce discretion and boost transparency. Water Diplomacy: Pakistan again warned India over Chenab-related water projects, saying any diversion would breach the Indus Waters Treaty. Environment & Health: World Environment Day messages from President and PM stressed climate risks to health, food security and water, while maritime officials warned of an Arabian Sea marine heatwave. Sports: Pakistan beat Australia 3-0 in ODI series decider (2-1 overall) in Lahore and also routed Maldives 3-0 in football, ending a long win drought.

Pak-US Diplomacy: PM Shehbaz Sharif called Pakistan and the United States a “true and special relationship” at the US Embassy’s 250th Independence Day event, highlighting cooperation from counterterrorism to trade and praising Trump’s role in restoring a Pakistan-India ceasefire after the Pahalgam crisis. Regional Mediation: Qatar’s foreign ministerial channel discussed Pakistan’s mediation push to de-escalate US-Iran tensions, urging all sides to respond positively to talks. UN Spotlight: Zimbabwe won a UN Security Council seat with 182 votes, returning after 33 years—an international governance signal for the region’s diplomatic calendar. Cricket & National Mood: Pakistan beat Australia by four wickets in the Lahore ODI decider to clinch the series 2-1, with Shaheen’s 3-30 and Shadab’s finishing role. Security Operations: ISPR reported four terrorists killed in Khyber Pakhtunkhwa intelligence-based operations in Dera Ismail Khan and Mohmand. Tax Reform Drive: PM Shehbaz ordered an AI-driven automated tax system pilot in Islamabad as part of FBR modernization and faceless collections. GB Politics: PPP chief Bilawal urged Gilgit-Baltistan voters to give a clear mandate on June 7 to pass land ownership legislation. Business Pressure: Karachi business groups warned FY27 budget risks hurting exports and urged an export-led approach ahead of the June 10 budget.