Pakistan's economy has left the ICU, says Khawaja Asif

Defence Minister Khawaja Asif said on Tuesday that Pakistan’s economy had left the “intensive care unit”.

He made the remarks while speaking in the National Assembly, during which he also talked about insecurity in Balochistan and Pakistan’s role in brokering the agreement with the United States and Iran.

“When we [presented] the first budget, we were insolvent. There was always the danger that we would default today or tomorrow. The International Monetary Fund (IMF) bailed us out with strict conditions, which we are now bearing but we have become solvent. Our economy is breathing; it has left the ICU,” he said.

“I will not say that we are reaching the stars but our trajectory bears witness that in one or two years … we will reach a place where Pakistan achieves a growth rate of 6-7 per cent,” he said.

He said that there were multiple “inbuilt taxes” in the country, adding that “we have to get rid of all these things to become solvent”. He said that the tax rate should be brought to a level where the entire country was ready to pay it instead of becoming prohibitive.

“Why should we force people to search for ways to evade taxes? We should bring taxes to a level where a conducive environment is created, where people pay taxes and do so with pride,” he said.

In his remarks, the defence minister also addressed the issue of terrorism in Balochistan, saying that the situation had not been created “yesterday or the day before” but that lots of people had contributed to it.

“I will not take names … but it is everyone’s responsibility,” he said, stressing that if Balochistan’s roads were not safe, the “collective responsibility” also lay with the House.

“I can accuse my brothers on that side of the aisle about what happened in their time, and they can accuse me, but it goes back to the 50s,” he noted, adding, “If we want to search for a solution, we have to search for it collectively.”

Mustafa Kamal lambasts ‘flawed’ NFC award distribution formula

Earlier in the session, Health Minister Mustafa Kamal on had criticised the formula of fund distribution under the National Finance Commission (NFC) award — which is based on the size of every provinces’ population — as “flawed”.

In his remarks during the National Assembly, where a debate on the federal budget fiscal year 2026-27 was ongoing, Kamal noted that the NFC formula was 82 per cent population-based.

Health Minister Mustafa Kamal addresses the National Assembly on June 16, 2026. — @NAofPakistan/X

“What province will reduce its income by controlling the population?” the minister, who belongs to the Muttahida Qaumi Movement-Pakistan (MQM-P), said.

“Balochistan is the smallest province [population-wise] and gets the lowest share [in the NFC]. If it wants to get [a larger] share like Punjab, it will have to increase its population,” he pointed out, adding the distribution of funds based on population was the “biggest flaw” in the system.

Without mentioning the name of any country, the health minister added that “in our neighbouring country, the weightage of population in the NFC award is 17pc,” while the rest was based on “revenue, backwardness, income and other areas”.

In his remarks, Kamal stated that “neighbouring countries are growing because they have controlled” their population growth.

He added that if the current trajectory of population growth continued, “we will need 64,000 new primary schools”.

“Do we have the capacity in the budget to allocate the resources for it?” he asked. The minister continued that at this rate, “we have to provide jobs to 65 million young people [and] will require 135,000 new beds in hospitals”.

He proposed that a “32pc incentive” had to be provided to every province that was trying to control its population.

He also lauded the government’s proposal in the budget to remove tax on contraceptives, which was earlier set at 18pc, saying it would reduce the birth rate and would have a greater impact on the population.

He also went on to highlight the issues in how funds allocated under the NFC were spent.

“Under the current system of governance … we can’t provide resources and solutions to people’s issues at their doorsteps,” he said. ...