The Nation Editorials 18th August 2026

Under Our Feet

Pakistan’s dependence on imported fossil fuels is no secret. For years, oil and gas purchases have drained precious foreign exchange, widened external vulnerabilities and fed inflation whenever global prices rise. The current crisis around the Strait of Hormuz has only made that dependence more visible, with industries, transporters and households hanging on every development that could disrupt supply or push prices higher.

Against this backdrop, Pakistan Petroleum Limited’s gas and condensate discovery at the Dolphin X-1 well in Sindh’s Sujawal district is welcome news. It may not become a major commercial field, and even if further evaluation proves promising, production will take time. But the discovery matters because it opens a previously untapped geological frontier and strengthens the case for sustained exploration.

PMD forecasts rain, thunderstorms in Shangla from Aug 17-21
The government, PPL and its partners deserve credit for pushing into difficult terrain rather than accepting old assumptions about where hydrocarbons can and cannot be found. The fact that this is the first discovery from the Jurassic-age Chiltan Formation in the Lower Indus Basin gives it significance beyond the immediate flow rate. A trickle of discoveries, taken together, can reveal patterns, attract investment and gradually improve Pakistan’s understanding of its own resource base.

This effort must now be pursued with consistency. Exploration is expensive, uncertain and often disappointing, but a fuel-importing country cannot afford to leave potentially productive basins untested.

‘Upper Chitral’s livestock, fisheries sectors can boost local economy’
The wider energy picture makes that urgency obvious. Pakistan now imports crude from as far away as the United States despite sitting in a region containing some of the world’s largest oil and gas producers. That is not simply irony; it is evidence of how complicated and fragile energy supply chains have become.

Domestic exploration will not eliminate imports overnight. But every viable field reduces exposure, saves foreign exchange and strengthens energy security. In a volatile world, Pakistan must search harder beneath its own feet.

Sensible Taxation

The Federal Constitutional Court’s decision allowing commercial entities to adjust super tax liabilities against available tax credits is a welcome affirmation of a basic principle of sensible taxation. Where a taxpayer has already accumulated legitimate credits, forcing it to pay another tax in full and then pursue a separate refund mechanism creates needless duplication and administrative friction.

Taxes should raise revenue, not manufacture procedural obstacles. The court was therefore right to reject a restrictive interpretation that would have prevented tax credits available under the Income Tax Ordinance from being adjusted against super tax liabilities where the law itself provides no such limitation.

PMD forecasts rain, thunderstorms in Shangla from Aug 17-21
The larger problem, however, lies beyond this particular dispute. Pakistan’s tax regime has gradually become a patchwork quilt of additional levies, exemptions, withholding provisions, surcharges, credits and overlapping rules. Each new fiscal pressure seems to produce another amendment rather than prompting a reconsideration of the system as a whole. The result is a structure increasingly difficult for businesses, individuals and even administrators to navigate.

The government desperately needs to reform tax law from top to bottom. Pakistan requires a cleaner, simpler and more coherent system in which taxpayers can readily understand what they owe, why they owe it and how their existing liabilities and credits interact.

‘Upper Chitral’s livestock, fisheries sectors can boost local economy’
There is an understandable temptation to judge tax policy primarily by how much immediate revenue it extracts. Yet clarity and predictability can ultimately be more valuable than squeezing every available rupee from those already inside the tax net.

A system perceived as arbitrary, contradictory or unnecessarily complicated discourages compliance and encourages avoidance. A transparent and comprehensible one makes formalisation easier and reduces the cost of doing business.

Pakistan’s tax base remains far too narrow. Expanding it will require more than enforcement drives and new levies. It requires trust in the system itself. The FCC has resolved one contradiction. Parliament and the government must now address the many others.

Empire Crumbling

The great imperial retreat continues. President Donald Trump’s decision to substantially reduce joint military exercises with South Korea may be presented as a dispute over costs, burden-sharing and relations with North Korea, but its symbolism reaches far beyond the Korean Peninsula.

The Gulf has already offered a warning. States that had built their security around American guarantees have watched Washington struggle to shield the region from the consequences of the Iran conflict and the disruption surrounding the Strait of Hormuz. South Korea, Japan and Taiwan will inevitably study those lessons. Security commitments are only as strong as the confidence others place in them.

PMD forecasts rain, thunderstorms in Shangla from Aug 17-21
Trump has not abandoned South Korea, nor has the US withdrawn its forces or formally weakened its treaty obligations. Yet strategic influence is rarely lost in one dramatic act. It erodes through accumulated signals of hesitation, conditionality and fatigue.

Reducing a major exercise at the last moment, particularly after openly criticising Seoul for refusing to participate in action against Iran, sends precisely such a signal. The additional emphasis on Trump’s relationship with Kim Jong Un only deepens uncertainty over where allies rank when American priorities shift.

More troubling for Washington is the wider regional perception. Any move interpreted as accommodation towards Beijing, directly or indirectly, will rankle allies already anxious about China’s expanding military and economic power. Beijing does not need America to leave Asia entirely; it merely needs regional capitals to doubt that Washington will always stay.

‘Upper Chitral’s livestock, fisheries sectors can boost local economy’
The United States remains the dominant military power across much of the Pacific, and its alliances remain formidable. But empires and spheres of influence rarely disappear overnight. They retreat inch by inch as commitments become negotiable and allies begin preparing for a world in which they must increasingly fend for themselves.

Across the South China Sea and beyond, that process appears to be gathering pace.