Rising inflation and prolonged economic instability made 2025 one of the most difficult years in recent memory for Pakistan’s low- and middle-income groups, while traders dismissed government claims of price relief as misleading.
Small traders said the year proved damaging for business activity, investment and employment, with commercial operations remaining below 60 per cent capacity due to continued political uncertainty.
The instability, they said, undermined investor confidence and discouraged the establishment of new commercial and industrial units.
A report compiled by Atiq Mir, head of the All Karachi Traders Alliance, described 2025 as a “year of closures”, noting that numerous businesses and industries shut down during the period.
The closures contributed to rising unemployment, while capital flight accelerated as investors moved funds abroad.
According to the report, persistently high inflation placed severe pressure on household finances, turning 2025 into what it called a “nightmare” for low- and middle-income families. It criticised the government for failing to safeguard trade and industry despite repeated claims of having steered the country away from default.
The report also highlighted weak public-sector performance, stating that despite 35 foreign visits undertaken by the leadership to attract investment, no substantial inflows materialised. Instead, domestic capital continued to exit the country.
Traders said no clear or effective strategy emerged to pull the economy out of crisis, adding that prospects for improvement in 2026 also appeared limited. Excessive taxation, alongside rising electricity, gas, fuel and dollar prices, further strained businesses and consumers alike.
The report noted that traditional market activity, including seasonal sales crowds, was largely absent throughout the year, reflecting sharply reduced purchasing power. While authorities pointed to easing inflation and selective economic indicators, traders said real economic activity remained depressed despite record highs in the stock market.
