Federal Minister for Finance Muhammad Aurangzeb has said although Pakistan’s economy is heading towards improvement under the International Monetary Fund (IMF) programme, the country continues to face two of the most critical long-term challenges - rapid population growth and climate change.

Addressing a ceremony in Islamabad, the finance minister said that reforms introduced through the IMF programme have put Pakistan on a path of macroeconomic stability. However, he warned that economic progress cannot be sustained unless the structural challenges of population growth and climate vulnerability are addressed with urgency.

Aurangzeb highlighted that Pakistan’s population is growing at an annual rate of 2.5%, a pace he described as incompatible with sustainable development.

He stressed that no country can achieve lasting economic growth when its population expands at such a high rate, placing pressure on national resources, public services and future planning.

The minister further said that climate change is compounding Pakistan’s economic difficulties, as the country remains one of the most climate-vulnerable nations in the world. He noted that controlling both population growth and climate risks has now become unavoidable if Pakistan wants to secure long-term resilience.

Aurangzeb also commented on Pakistan’s global emissions profile, saying that although the country is not a major contributor to carbon emissions, population trends still have a direct impact on its carbon footprint.

“We often say that Pakistan does not emit carbon on a large scale, but the truth is that if the population growth rate declines, carbon emissions in Pakistan also decrease proportionally,” he remarked.

The minister emphasized that both challenges must be confronted through coordinated national policies, public awareness and long-term planning, adding that economic reforms alone cannot deliver sustainable prosperity without addressing the underlying demographic and environmental pressures.