In a stark and urgent warning, Pakistan’s central bank chief has said that the country’s existing economic growth model is no longer capable of supporting its population of nearly 250 million people. Jameel Ahmad, Governor of the State Bank of Pakistan (SBP), stressed the need for a complete rethinking of the economic policy framework, just a day after Planning Minister Ahsan Iqbal blamed the International Monetary Fund (IMF) for Pakistan’s highest unemployment rate in more than two decades.
Speaking at the opening session of the Pakistan Business Council’s (PBC) “Dialogue on the Economy” on Wednesday, Ahmad highlighted the alarming trajectory of Pakistan’s economic growth. He pointed out that economic performance has been steadily declining over time — falling from an average of 3.9% over the last 30 years to 3.5% over the past 20 years, and further down to 3.4% during the last five years, according to The Express Tribune.
“Our business cycles are shortening and, as such, our current growth model simply cannot sustain a country of over 250 million people,” Ahmad warned, emphasising the urgency of a strategic shift.
Pakistan, he noted, is trapped in a prolonged phase of economic stabilisation. This cycle has placed a heavy burden on the public and businesses alike, reflected in rising taxes, surging energy costs meant to offset inefficiencies, and little control over the government’s growing expenditure.
“Continuing with stabilisation policies indefinitely is neither desirable nor sustainable,” he said.
The consequences are already visible. According to the latest Labour Force Survey released on Tuesday, unemployment has climbed to a 21-year high of 7.1%. The World Bank has also estimated that poverty has surged to 44.7%, signalling deep distress among ordinary Pakistanis. Planning Minister Ahsan Iqbal attributed the rising joblessness to climate disasters and the IMF’s strict stabilisation programme, which he said has suppressed economic growth.
Ahmad emphasised that the country must break out of the cycle of short-term fixes and instead focus on structural reforms driven by long-term planning. He urged policymakers to “rethink the economic model” and called on both the government and the business sector to adopt a long-term outlook for policies and investment decisions.
Calling the shift “imperative,” the SBP governor advised companies not to prioritise short-term profits at the expense of long-term stability and national economic health.
“There is growing recognition that sustainable growth will remain elusive until policymaking is reoriented towards a long-term vision of achieving socio-economic prosperity for the people, rather than chasing short-term consumption-led growth spurts,” Ahmad said.
As Pakistan struggles to manage rising poverty, unemployment, and fiscal pressures, Ahmad’s message underscores the need for a fundamental reset — one that replaces stop-gap measures with a durable, forward-looking economic strategy.