Business Recorder Editorials 12th September 2026

New map for old problems?

EDITORIAL: That Pakistan’s present governance structure has failed to deliver adequately to a population of around 250 million is increasingly difficult to dispute. The question now gathering force, however, is whether creating new provinces or “administrative units” would actually address that failure, or simply reorganise it.

With senior political and state figures openly discussing changes to the country’s administrative map, this debate deserves to move quickly beyond slogans. If Pakistan is indeed approaching a significant restructuring of the federation, the costs, constitutional implications and likely governance benefits must be examined before political momentum hardens into policy.

The case for smaller units is not frivolous. Provinces containing tens of millions of people can themselves become highly centralised structures, with authority and resources concentrated in provincial capitals while distant districts remain poorly served. Smaller provinces could shorten administrative distances, improve responsiveness and potentially give neglected regions a stronger political voice. Islamabad could conceivably be turned into a province, southern Punjab has long generated demands for separate status, and other possibilities can reasonably be debated.

But every new province would bring substantial consequences. Constitutional amendments would be required, along with the necessary political consensus and, where provincial boundaries are altered, approval from the affected provincial assembly. New governments would require legislatures, cabinets, secretariats, bureaucracies and administrative infrastructure. Their place in federal revenue-sharing arrangements would also have to be settled. If Islamabad, for example, became a province, it would presumably require an agreed share of national resources through the NFC framework. Who has calculated the fiscal implications of such changes, the recurring administrative costs or the disruption involved in implementing them?

There is also the more important governance question. How much would the creation of new units achieve if the political and administrative culture operating inside them remained unchanged? Smaller provinces could still centralise power in new provincial capitals, reproduce the same bureaucratic weaknesses and leave citizens waiting for decisions taken far from their communities. The country therefore needs to examine whether geography is genuinely only the principal obstacle to effective government.

That inevitably brings local government into the discussion. Pakistan already has a mechanism for taking government closer to citizens through meaningful political, administrative and fiscal devolution. Yet provincial governments have consistently resisted transferring substantial authority and resources to elected local bodies. Municipalities and districts are where many of the services that affect everyday life are actually delivered, but they remain the weakest tier of the political system.

The irony is difficult to miss. The most ambitious attempt at empowered local government in recent decades came under General Pervez Musharraf, a military ruler. Since the return to democratic rule, elected political leaderships have repeatedly shown far less enthusiasm for strengthening the third tier, even when pushed towards local elections and devolution by the courts. Provincial autonomy is defended vigorously when authority is flowing from Islamabad to the provinces. The enthusiasm tends to diminish sharply when the same principle requires resources and decision-making power to move from provincial capitals to districts, towns and neighbourhoods.

There is an obvious political reason for this reluctance. Genuine local government disperses patronage, spending authority and administrative control. It places resources closer to voters and reduces the dependence of local communities on provincial legislators and party hierarchies. That redistribution of power has rarely appealed to those who currently possess it.

None of this settles the argument against new provinces, of course. They may ultimately prove necessary, and a serious national debate on their creation is overdue. But that debate must include hard numbers, constitutional pathways, fiscal consequences and clear evidence of how smaller units would improve service delivery. It must also confront the question of why proper grassroots devolution has been resisted for so long.

Pakistan may well need a different administrative map. But before drawing one, it should establish whether the reform being proposed will genuinely move power closer to the citizen, or merely create more places from which it can remain concentrated.

GSP+ at risk

EDITORIAL: Pakistan’s trade relationship with the European Union is facing an important test, and the message from European officials could hardly be clearer: preferential access to the bloc’s market under the GSP+ scheme cannot be taken for granted.

EU’s Ambassador to Pakistan Raimundas Karoblis recently described the country as being at a “very critical” juncture, warning that continued GSP+ preference will depend on credible, measurable progress in meeting the scheme’s commitments.

Meanwhile, the Dutch ambassador has issued a similar warning, saying that continuation of Pakistan’s GSP+ status is “not necessarily a given”, stressing the need for concrete steps, particularly on human rights.

The warnings matter enormously for Pakistan’s export economy. The EU is the country’s largest export destination, accounting for 14.1 percent of its total trade. Bilateral goods trade reached €12.2 billion in 2025, while over 85 percent of Pakistan’s exports currently enter the EU duty- and quota-free under GSP+.

Furthermore, approximately 89 percent of Pakistani textile products that are imported by the EU benefit from preferential tariffs.

The potential cost of losing this access, then, cannot be overstated. As Ambassador Karoblis has warned, the country’s textile producers could face tariffs of roughly nine to 12 percent on products that currently enjoy zero-duty access. Such an increase would directly erode competitiveness in a sector already confronting intense pressure from rival suppliers.

This is precisely why Pakistan needs to take the European Commission’s latest assessment of its GSP+ commitments seriously, rather than remain preoccupied with contesting aspects of it.

The assessment acknowledges progress in some areas, but has also pointed to regression in others, including when it comes to enforced disappearances, minority rights, freedom of expression and media freedoms, and extrajudicial killings, while also raising concerns over judicial independence and accountability for human rights violations.

The key issue is the persistent gap between laws on paper and their effective implementation. This matters even more as the EU’s new GSP regulation, taking effect in January 2027, places greater emphasis on demonstrable implementation and measurable progress.

Moreover, under the new regulation, the EU will be assessing implementation of 32 international conventions, up from 27, with the framework adding areas like disability rights, children in armed conflict and labour inspection.

It is clear that concerns regarding human rights are likely to remain particularly consequential, and these should not be dismissed as Europe imposing alien standards on Pakistan. As Ambassador Karoblis has noted, the GSP+ requirements principally relate to international conventions that Pakistan itself has ratified. The issue, therefore, revolves around whether those commitments are being implemented in practice. There is some reason for cautious optimism.

The commerce ministry has begun mapping the EU’s recommendations and developing an institutional action plan covering the 32 conventions, with implementation and monitoring assigned across relevant ministries. That is the right approach. But an action plan will have little value unless it produces measurable outcomes and sustained institutional reform.

Pakistan must also recognise the shifting competitive landscape. With Bangladesh, Egypt and Tunisia competing for textile markets, and an EU-India trade agreement potentially strengthening India’s position, the country cannot afford to surrender an advantage while rivals gain ground.

The objective now should be to use the time available before the current GSP+ arrangement expires to address the concerns at the heart of the new framework.

Many of these are fundamental to improving governance, protecting rights and strengthening the institutions that serve Pakistan’s own citizens.

The country’s response to Europe’s warnings should therefore be meaningful reform, not resistance. For an economy so dependent on textile exports and external markets, protecting GSP+ is both an economic imperative, and in many respects could also be a means of improving the lives of ordinary citizens.