Pakistan takes action to bridge supervision gaps with foreign NGOs and illegal commerce.
Pakistan is stepping up measures to stop the expansion of illegal trade, especially in the tobacco industry, where tax evasion remains a major problem, as part of its strong commitment to safeguarding national revenue and bolstering its legitimate economy. According to experts, the unbridled growth of untaxed and unregulated cigarette sales costs the nation around PKR 415 billion per year.
Even while authorities have improved control and policy, enforcement has not kept up with the speed of unlawful operations. Consequently, the formal tobacco industry has seen its market share decline to just 46%, even though it generates an overwhelming 98% of the industry’s overall tax revenue. The legal sector continues to pay over 270 billion PKR in taxes annually, which is indicative of its significant contribution to the national economy.
“Illicit trade directly undermines Pakistan’s attempts to create a just and open economy; it is not only a business loophole. Every rupee lost is a missed opportunity to invest in our future — in education, healthcare, and infrastructure,” says Fawad Khan, spokesperson for Mustehkam Pakistan, a local initiative advocating for public interest-driven governance. “International engagement is desirable, but it must respect Pakistan’s institutions and legal framework. Under the pretense of advocacy, no organization should be permitted to circumvent our systems.
Closer examination of foreign organizations involved in Pakistan’s health and policy landscape has also been spurred by recent events. Campaign for Tobacco-Free Kids and Vital Strategies are two international non-governmental organizations (INGOs) who have been ordered to immediately cease operations by the Ministry of Interior due to their noncompliance with national registration requirements.
The INGOs reportedly carried on with their activities, including transferring funds to local organizations and interacting with policymakers, in spite of a clear directive in early 2024 to cease operations. They did this without obtaining the required approvals from the Securities and Exchange Commission of Pakistan or the Ministry of Interior’s Economic Affairs Division.
To demonstrate the gravity of the situation and the government’s determination to uphold the law everywhere, the Ministry has now instructed the State Bank of Pakistan to freeze all accounts connected to these INGOs.
Pakistan is still totally dedicated to having positive interactions with its foreign allies. However, all parties involved, both domestic and international, are expected to act openly and in complete compliance with national laws as the nation works to safeguard its legal system and economic integrity.
