Pakistan Implements Austerity Measures Amid Economic Strain

Mar 10, 2026

84 min

Mar 10, 2026 11:30

Pakistan’s austerity measures: All you need to know

## Government Announces Austerity Plan

Pakistan's Prime Minister Shehbaz Sharif has unveiled a series of austerity measures to address the country's economic challenges, exacerbated by rising global oil prices due to geopolitical tensions. These measures aim to reduce fuel consumption and government expenses.

## Key Measures

Government offices will now operate four days a week, with half of the staff working remotely, except for essential services and banking. Schools will close for two weeks starting March 16, while universities will switch to online classes.

Fuel allowances for official vehicles will be halved for two months, with ambulances and public buses exempt. Additionally, 60% of government vehicles will be grounded, and officials are encouraged to use teleconferencing to save fuel. Foreign travel for government officials is limited to essential trips.

## Spending Cuts

Federal and provincial cabinet members will not receive salaries for two months. Lawmakers' salaries will be reduced by 25%, and senior officials earning over Rs300,000 are encouraged to donate two days' salary. Departments must cut non-employee expenditures by 20%, and purchases of certain items are banned until June 2026. Official events will be minimized or held on government premises.

## Economic Context

Sharif highlighted Pakistan's reliance on imported oil and gas, making it susceptible to global price changes. With oil prices exceeding $100 per barrel, these steps are crucial to conserving resources and stabilizing the economy. The government is also taking measures to prevent profiteering and hoarding of oil.

## Diplomatic Efforts

The Prime Minister condemned the US-Israeli actions against Iran and emphasized Pakistan's pursuit of diplomatic solutions. The country's armed forces are prepared to secure its borders under the leadership of Chief of Defence Staff Asim Munir.

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