The past year will be remembered as one in which Pakistan confronted pressure on multiple fronts and emerged with renewed strategic confidence. The most serious test came on 7 May, when India carried out cross-border strikes in Pakistani territory, violating sovereignty and pushing the region toward a dangerous escalation. Pakistan’s response combined military preparedness with political restraint, avoiding reckless confrontation while firmly asserting its position. By engaging the international community, Pakistan helped prevent further escalation.
The confrontation highlighted the maturity of Pak-China defence cooperation, with jointly developed platforms operating effectively during heightened tensions. In the aftermath, Pakistan witnessed a diplomatic rebound. Engagement with the United States resumed on broader terms, moving beyond a narrow security lens toward trade, climate, and regional stability. Ties with Saudi Arabia were elevated through deeper strategic and economic cooperation, reaffirming a partnership that remains central to Pakistan’s regional standing. At the same time, Pakistan expanded its regional outreach, renewing ties with Jordan and Egypt, strengthening links with Central Asian states, and deepening engagement with Malaysia, Indonesia, Bangladesh, and Iran, reflecting a more confident and outward-looking foreign policy.
Economic stabilisation remained a parallel priority. Inflation was brought down to single-digit levels, the policy rate was reduced to 10.5 per cent, and foreign exchange reserves climbed to around $21 billion. For the first time in years, Pakistan has strengthened its economic position and increased foreign reserves, improving its capacity to meet international obligations while continuing to work with the IMF and friendly countries for additional support. While critics remain impatient, reversing years of economic distress is neither simple nor swift. Stabilisation, however, has created the conditions for growth, and if current trends persist, the economy is well-positioned to take off in the coming year.
On the governance front, the passage of the 27th Constitutional Amendment, decisive action against violent extremism, and the unprecedented prosecution and conviction of a former DG ISI marked significant steps toward institutional accountability and the rule of law. Social initiatives, including the distribution of laptops to students and visible progress across sectors in Punjab, reflected continued investment in youth and development.
At the same time, Pakistan’s relations with Afghanistan have strained, with border closures and trade disruptions following repeated attacks by militants operating from Afghan territory. Islamabad has held the Afghan authorities responsible for failing to curb these groups, highlighting ongoing security and economic challenges along the border.
Taken together, 2025 demonstrated Pakistan’s capacity to confront external aggression, stabilise its economy, and recalibrate diplomacy while advancing governance reforms. The year marked a consolidation of direction rather than perfection.
Wishing you a very Happy New Year!
The writer is a SUN (Scaling Up Nutrition) UN Global Champion and a dairy value chain professional.
