Prime Minister Shehbaz Sharif. Photo: File
ISLAMABAD:
The federal cabinet, at its meeting on Friday, approved a series of key policy decisions, including measures to introduce a new local government system in the capital and the formal ratification of the committee’s previous decisions.
Chairing the meeting, Prime Minister Shehbaz Sharif highlighted economic stabilization and continued reforms as the central priorities of the government. He highlighted that the growth recorded in the first quarter of the current financial year was a sign of renewed confidence.
The economy has moved from the brink of default to a more stable footing, the prime minister said, addressing cabinet members. He reiterated the government’s commitment to restructuring loss-making public enterprises.
The Prime Minister highlighted the sale of a majority stake in Pakistan International Airlines (PIA) as a turning point, saying: “The privatization of PIA is an extremely important step in this regard. »
He expressed satisfaction that 75 percent of PIA’s shares had been privatized through a transparent bidding process, insisting that limiting losses of public entities was essential to the broader economic reform effort and restoration of fiscal space.
Shehbaz also briefed the cabinet on his recent diplomatic moves, describing his meetings with UAE President Sheikh Mohamed bin Zayed Al Nahyan as extremely useful for bilateral relations. He said he had a “pleasant” telephone conversation with Saudi Crown Prince Mohammed bin Salman, during which the two sides discussed economic and strategic cooperation.
The ministers formally ratified the decisions taken by the Cabinet Committee on Legislative Affairs (CCLC) in its meetings on December 3 and 30, 2025, including procedures related to the Islamabad Capital Territory Local Government (Amendment) Ordinance, 2025, which will underpin the new local governance structure planned in the federal territory.
The cabinet further approved the resolutions of the August 26, 2025 session of the Economic Coordination Committee, including relief measures for consumers of power distribution companies under the off-grid tax (captive power plants) and a strategy to manage the implementation of the policy.
On the recommendation of the Petroleum Division, the cabinet approved the proposal to issue an order to amend the Off-Grid Off-Grid Offtake (Captive Power Plants) Act, 2025, paving the way for third-party gas sales to off-grid captive power producers under a revised legal framework.
Meanwhile, the federal government, following the cabinet decision, has decided to issue an ordinance amending local administration, with a summary proposing the ordinance being forwarded to the President for approval, sources said.
The sources said the Punjab model will serve as the basis for conducting local body elections under the new ordinance. The move reflects the government’s intention to streamline local governance structures ahead of the next elections, they added.
