Islamabad Capital Territory

Islamabad | ReNews Pakistan
Gulf investors have increased their exposure to Pakistan, investing nearly $150 million in government bonds and treasury bills during the first 25 days of September 2026, according to official data.

The United Arab Emirates accounted for the largest share of the inflows, with UAE based investors placing around $115 million in Pakistani government securities during the period.

Investors from Bahrain contributed approximately $24 million, while other Gulf countries collectively invested around $10 million, reflecting a broader increase in regional interest in Pakistan’s financial assets.

Finance Ministry officials said relatively high yields on government securities, attractive returns and improving macroeconomic stability had helped restore confidence among foreign investors, particularly those from Gulf economies.

According to officials, the rising level of foreign participation indicates that Pakistan is regaining attention as an investment market in the region, although the sustainability of these inflows will depend on continued economic stability, exchange rate conditions, interest rates and policy consistency.

The renewed Gulf interest in Pakistan’s financial markets could also have wider implications for investment in real estate and other asset classes. A sustained improvement in investor confidence may create stronger prospects for Gulf capital to move into housing, commercial property, tourism, infrastructure and other long term projects.

Pakistan’s real estate sector has traditionally attracted interest from overseas Pakistanis and investors linked to Gulf markets. Further improvements in regulatory transparency, digitisation of property records and investment facilitation could strengthen the case for foreign participation in large residential, commercial and mixed use developments.

However, the nearly $150 million recorded during September represents investment in government securities rather than direct real estate investment. Any subsequent increase in property investment would depend on separate investment decisions, project viability, regulatory conditions and expected returns.

The latest inflows are significant because investors from the UAE, Saudi Arabia, Bahrain and other Gulf economies have the capacity to deploy capital across infrastructure, energy, tourism and property. Greater confidence in Pakistan’s financial markets could therefore provide a foundation for broader and longer term Gulf investment in real assets if favourable conditions are sustained.

Islamabad | ReNews Pakistan
A three day Saudi real estate exhibition showcasing property projects and investment opportunities across the Kingdom is set to take place in Islamabad from October 23 to 25, 2026, offering Pakistani investors direct exposure to Saudi Arabia’s expanding property market.

The exhibition is aimed at connecting Pakistani investors, businesspeople and real estate professionals with Saudi developers and other stakeholders while providing information about residential, commercial and other property investment opportunities in the Kingdom.

The event is being organised by the Federation of Saudi Chambers through the Saudi-Pakistani Business Council. The Eastern Province Chamber of Commerce has also circulated official invitations among its members for participation in the exhibition.

The deadline for companies and exhibitors seeking to participate in the event was September 27, indicating that the initial phase of exhibitor registration has already concluded.

The initiative is expected to contribute to strengthening economic, business and investment ties between Pakistan and Saudi Arabia while giving Pakistani investors greater access to information about opportunities emerging in the Saudi property market.

The exhibition comes as Saudi Arabia continues to undertake major residential, commercial, tourism and urban development projects, creating new opportunities for local and international investors across different segments of the real estate sector.

Unlike many overseas property exhibitions that primarily promote Pakistani real estate projects to foreign investors, the Islamabad event will bring Saudi property offerings directly to prospective investors in Pakistan.

Potential investors and buyers are advised to conduct appropriate due diligence before committing funds, including verifying the developer behind a project, the authorisation of representatives or agents, payment arrangements and the rules governing foreign property ownership in the relevant city or region of Saudi Arabia.

Islamabad | ReNews Pakistan
Pakistan’s salaried class paid around Rs 144 billion in income tax during the first quarter of fiscal year 2026-27, significantly exceeding the combined tax contribution of retailers and the real estate sector, according to provisional data from the Federal Board of Revenue (FBR).
During the July-September quarter, combined income tax payments from the retail and real estate sectors stood at approximately Rs 54 billion, around Rs 90 billion lower than the amount collected from salaried individuals.
The figures highlight a widening gap in tax contributions among major segments of the economy, with salaried taxpayers continuing to provide a substantially larger share of income tax revenue despite measures announced by the government to broaden the tax base.
FBR data showed that income tax collections from the real estate sector declined by 38% year-on-year to Rs 35.2 billion during the first three months of the current fiscal year. The decline followed the government’s decision to substantially reduce advance tax rates applicable to property sales and purchases.
Tax collected on property sales fell by 42% to Rs 23 billion, compared with Rs 39.5 billion during the corresponding period of the previous year. Similarly, tax collection from property purchases declined by 31% to Rs 12.2 billion from Rs 17.7 billion a year earlier.
Under the revised taxation regime, the advance tax rate on property purchases was reduced from 2.5% to 1.25%. For property sales, the previous tax structure involving three slabs was replaced with a single rate of 2.75%, compared with the earlier rate of up to 5.5%.
The reductions were introduced as part of the government’s fiscal measures and were endorsed under Pakistan’s programme with the International Monetary Fund. The latest revenue figures indicate that the lower advance tax rates have had a significant impact on collections from property transactions.
The real estate sector had contributed around Rs 200 billion in income tax during fiscal year 2023-24, while its contribution increased to Rs 236 billion in fiscal year 2025-26 before the latest reductions in property transaction taxes took effect.
Tax receipts from wholesalers and retailers, meanwhile, showed limited growth during the first quarter. Withholding tax collections from the two segments totalled Rs 18.4 billion, increasing by only Rs 244 million, or approximately 1.3%, from the same period last year.
Wholesalers contributed Rs 6.2 billion, representing a 10% year-on-year decline, while retailers paid around Rs 11.3 billion, an increase of 8.3%.
The relatively modest increase came despite government efforts to bring more retailers into the tax net, including the introduction of a fixed taxation mechanism aimed at increasing revenue from the country’s large wholesale and retail economy.
In contrast, income tax collected from salaried individuals increased by Rs 13.4 billion, or 10.2%, during the July-September quarter compared with the corresponding period last year.
The annual tax contribution of salaried workers has also risen sharply in recent years. According to official figures, collections from salaried taxpayers increased from around Rs 391 billion before Pakistan entered its current IMF programme to Rs 629 billion by the end of June 2026.
The government has maintained that the latest federal budget provided approximately Rs 52 billion in relief to salaried taxpayers through reductions in income tax rates of up to three percentage points, abolition of the 9% surcharge and an increase in the annual income threshold for application of the maximum 35% tax rate from Rs 4.1 million to Rs 7 million.
Despite these measures, salaried households continue to face pressure from higher energy and living costs. The government is currently passing movements in international oil prices on to consumers while imposing a petroleum levy of Rs 80 per litre and a climate support levy of Rs 5 per litre.
Higher fuel costs can also feed into transportation and production expenses, adding pressure to the prices of food and other essential goods.
The latest tax figures come against the backdrop of repeated government commitments to expand Pakistan’s tax base and reduce disproportionate reliance on documented taxpayers. Prime Minister Shehbaz Sharif has previously pledged to ease the burden on salaried workers as more sectors are brought effectively into the tax system.
However, the first-quarter figures indicate that tax revenue from salaried individuals continues to rise, while collections linked to property transactions have fallen substantially and revenue growth from the wholesale and retail sectors remains limited.