ISLAMABAD: The government has introduced more than 660 reforms across 35 ministries, divisions and public sector institutions in Pakistan, while facing one of its most persistent challenges in 2025: macroeconomic fragility.
According to a report released by Mishal Pakistan, the World Economic Forum’s country partner institute, high public debt, constrained foreign exchange reserves, inflationary pressures, and energy sector liabilities sharply limited fiscal maneuverability. The need to stabilise the economy under an IMF-supported programme required difficult trade-offs between short-term stabilisation and long-term development spending.
“This fiscal constraint affected reform implementation across sectors. While ambitious structural reforms, particularly in energy, taxation and state-owned enterprises, were initiated, the availability of resources for rapid scaling, technology upgrades and human capital expansion remained limited,” the report stated. As a result, many reforms had to be sequenced carefully, emphasising system redesign and governance restructuring before large-scale expenditure.
The report ranked the Ministry of Energy (Power Division) as the single largest contributor, accounting for approximately 118 reforms (38–42 percent), reflecting the centrality of energy to fiscal and economic stability.
The Ministry of Law and Justice ranked second with 96 reforms, underscoring the priority placed on rule of law, digital justice, and legal modernisation. The Ministry of Foreign Affairs ranked third, contributing 42 reforms, driven by digitisation, compliance frameworks and multilateral engagement.
The Ministry of Science and Technology showed strong momentum, particularly in digital governance, innovation infrastructure and regulatory modernisation. Economic and financial institutions collectively accounted for a smaller but strategically significant share, reflecting reforms with high leverage rather than high volume.
Information, Media and Communication introduced the fewest reforms at 19, followed by Privatisation & State-Owned Enterprises (21 reforms), and Transport, Infrastructure and Aviation (24 reforms).
The federal government has set an ambitious target to implement wide-ranging operational, structural and governance reforms in 2026, with a focus on achieving the Sustainable Development Goals (SDGs), improving service delivery, and strengthening state capacity.
Reforms were carried out across key sectors including finance, planning, energy, commerce, law and justice, regulatory bodies, audit frameworks, health, housing, power, science and technology, digital governance, climate change, and investment facilitation. The reform agenda extended beyond policy changes to include institutional restructuring, infrastructure upgrades, digitisation of systems, regulatory frameworks, coordination mechanisms and procedural reforms.
The report notes that more than 200 reforms have now been implemented through digital platforms, which has improved transparency and reduced discretionary powers within government processes.
The scale of reforms has expanded sharply over the past year, with the report noting a fivefold increase in the volume of reform measures compared to the previous year, despite continued fiscal pressures, regional security challenges and geopolitical tensions. It states that the government is attempting to move from short-term stabilisation towards building long-term state capacity through structural changes, particularly in the legal and IT sectors.
In the financial and energy sectors, the report highlights major fiscal savings expected from the renegotiation and restructuring of contracts with independent power producers (IPPs), with projected savings of Rs1.4 trillion for the power sector. It adds that progress on domestic energy and mineral development is being positioned as a key pillar of economic recovery, including advances on the $6 billion Reko Diq copper and gold project and new tight gas and offshore exploration policies aimed at attracting up to $5 billion in investment. The report also refers to longer-term investment targets of up to $11 billion linked to gas policy reforms and mining projects.
Speaking at the report launch, Mishal Pakistan Chief Executive Officer Amer Jahangir said that while the breadth of reforms was encouraging, the government needed to place even greater emphasis on implementation, digitisation and institutionalisation of systems. He said the purpose of the Pakistan Reforms Report was to document the reform journey and provide a reference point for citizens, researchers and future policymakers.
Federal Minister for Climate Change Dr Musadik Malik, speaking at the launch ceremony, said there would be no compromise on transparency and evidence-based policymaking. He said fact-based reporting on reforms helped build public trust and accountability.
He also criticised bureaucratic bottlenecks, saying frequent changes in rules had not translated into meaningful change for citizens. Referring to past governance practices, he said inefficiencies and procedural hurdles in the power sector had contributed to weak recoveries by distribution companies, forcing higher bill recoveries from consumers.
