Pakistan’s new finance minister, Muhammad Aurangzeb, has stepped into one of the most challenging roles in the country, determined to steer the economy toward stability. Appointed last month, Aurangzeb takes the reins during a turbulent economic period characterized by soaring inflation, sluggish growth, and a crisis-ridden relationship with the International Monetary Fund (IMF).
Pakistan’s economy is at a critical juncture, grappling with one of the lowest tax-collection rates globally, alongside an ongoing cycle of bailouts. With the IMF labeling its debt as only borderline sustainable, Aurangzeb faces the unenviable task of reforming an economy that has lurching from one crisis to the next. As the country holds the record for Asia’s highest inflation rates, the stakes for Aurangzeb and his team could not be higher.
A seasoned banker and former executive at JPMorgan Chase & Co., Aurangzeb is arguably better equipped than many of his predecessors to tackle these challenges. However, his position is complicated by external factors beyond his control, including volatile domestic politics, strained relations with neighboring countries such as India and Afghanistan, and the devastating impacts of climate change that disproportionately affect Pakistan.
“Broadly, the finance minister’s job is to manage and steer the economy,” says Mosharraf Zaidi, a former government adviser and founder of the Islamabad-based policy think tank Tabadlab. “It seems simple when framed this way. In fact, it is one of the most complex jobs on the planet.”
Immediate Challenges Ahead
Among Aurangzeb’s immediate priorities is securing a minimum three-year deal with the IMF by June, potentially worth at least $6 billion. Key objectives in these negotiations include broadening the tax base, improving debt sustainability, and restoring viability to the energy sector—all steps that have been historically avoided by previous administrations. The urgency of these tasks cannot be understated; the country’s economic future hangs in the balance, and any misstep could lead to severe consequences.
Aurangzeb acknowledges a shared sense of urgency with Prime Minister Shehbaz Sharif, elected for a second consecutive term in March. “He’s a person who wants to get things done,” Aurangzeb noted in an interview. “This is the time to capitalize on that mandate and ensure that all the tough decisions that need to be taken are taken now,” he emphasized, warning that any delay could result in “a huge missed opportunity that we can ill afford.”
Despite his optimism, Aurangzeb is aware that tough decisions—such as raising energy prices and privatizing state-owned enterprises—are likely to face significant backlash from powerful business lobbies and the public. Historically unpopular, these reforms are essential to halt the spiraling state losses that have plagued the economy for years.
A Personal Journey
Born into a prominent family in Lahore, Aurangzeb has an impressive educational background. He attended Aitchison College, one of Pakistan’s most prestigious schools, before studying at Wharton on a scholarship. His professional journey has included significant roles at Citigroup Inc. in New York and ABN Amro Bank in Amsterdam, culminating in his appointment as CEO of Habib Bank Ltd. in Pakistan.
In a notable display of commitment to his home country, Aurangzeb renounced his Dutch citizenship to accept the finance minister position. “It’s a huge privilege,” he said, acknowledging the weight of expectations that come with the role.
His office, situated close to the prime minister’s office in Islamabad, is now equipped with a large television displaying stock market prices and economic indicators—tools of the trade for a man who has traded in his comfortable corporate life for the uncertainties of national governance.
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Navigating Political Landscape
Aurangzeb’s entry into the political arena comes with challenges. He is seen as a political outsider, not a member of Sharif’s party and appointed in a technocratic capacity. This status is significant given the political volatility in Pakistan, where alliances can shift rapidly.
Efforts to constrain Aurangzeb’s influence have already emerged, such as Prime Minister Sharif’s initial decision to chair the Economic Coordination Committee—a powerful policy-making body typically led by the finance minister—before retracting after public outcry. Moreover, Foreign Minister Ishaq Dar, a seasoned politician, has been appointed to head a privatization committee that would usually fall under Aurangzeb’s jurisdiction.
With a history of frequent changes in leadership—Pakistan has seen more than ten finance ministers in the past decade—Aurangzeb represents a fresh face in a role long burdened by economic crises and political instability. As he embarks on this daunting journey, the eyes of the nation are on him, hopeful that he can indeed steer Pakistan’s economy toward recovery amidst overwhelming challenges.
