Pakistan calls for reset in South Asia as dialogue with India hits 11-year freeze

Pakistan’s Deputy Prime Minister Ishaq Dar addresses the “Islamabad Conclave 2025” at the Institute of Strategic Studies in Islamabad, Pakistan, on December 3, 2025. (ISSI)
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Updated 03 December 2025
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Pakistan calls for reset in South Asia as dialogue with India hits 11-year freeze

  • Deputy PM criticizes SAARC’s paralysis, says rising climate pressures require renewed regional cooperation
  • Ishaq Dar speaks in favor of multilateralism, warns that states are using force in disregard of international law

ISLAMABAD: Pakistan’s Deputy Prime Minister Ishaq Dar on Wednesday urged a “reimagining” of South Asia’s fractured regional architecture, saying an 11-year freeze in dialogue with India was undermining prospects for long-term stability and peace in one of the world’s most volatile regions.

India and Pakistan fought a brief but intense military clash in May this year in which both nuclear-armed neighbors exchanged missiles, artillery fire and deployed fighter jets. The standoff lasted about four days before the United States brokered a ceasefire, saying the two sides had agreed to talk.

While Pakistan continued to call for a “composite dialogue” to resolve all outstanding disputes, India declined to proceed with negotiations.

Dar made the remarks while addressing the Islamabad Conclave 2025, a two-day gathering focused on security, economy, climate and connectivity in South Asia.

“The end of Cold War largely bypassed South Asia, leaving the region with few peace dividends,” Dar said while addressing the gathering. “We, the South Asians, need to think really hard. Are we doomed to remain mired in confrontation and conflict while other regions progress and prosper? The answer should be a clear no.”

He noted the region had weak conflict management and dispute resolution institutions, pointing out that “structured dialogue process between India and Pakistan remains stalled for over 11 years.”

Dar said South Asia’s fragmented political landscape, economic vulnerabilities and climate pressures had made cooperation increasingly urgent, warning that rising temperatures, extreme weather events and glacial melt were threatening water security, agriculture and livelihoods across the region.

He said the cumulative challenges of security, economic fragility and climate change were “too grave to disregard” and could not be effectively tackled without a more functional regional architecture.

He also criticized the paralysis of the South Asian Association for Regional Cooperation (SAARC) which has remained largely inactive for more than a decade, saying “artificial obstacles” must be removed to allow the organization to resume its role as a platform for economic cooperation.

Dar pointed to new trilateral initiatives, including one between Pakistan, China and Bangladesh, as examples of how smaller regional groupings could advance connectivity and collaboration where broader institutions had stalled.

Calling for South Asia to move beyond “zero-sum mindsets,” the deputy prime minister said the region needed dialogue, peaceful coexistence and economic interdependence, adding that open and inclusive regionalism remained essential for sustainable peace.

He maintained Pakistan envisioned a South Asia “where connectivity replaces divisions” and where disputes were resolved in accordance with international legitimacy.

Dar said the region would only realize its economic and political potential if all countries committed to cooperation.

He also spoke in favor of multilateralism, saying the world was witnessing growing military conflicts as states increasingly resorted to the use of force to settle disputes, showing disregard for international law and the principles of the UN Charter.


Pakistan disburses record $9.2 billion agricultural loans in FY25, central bank says

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Pakistan disburses record $9.2 billion agricultural loans in FY25, central bank says

  • State Bank says farm lending rose 16 percent year-on-year to Rs2.58 trillion
  • Inflation eased to 5.8 percent in January as GDP growth hits 3.7 percent in Q1 FY26

KARACHI: Pakistan disbursed a record Rs2.58 trillion ($9.2 billion) in agricultural loans during fiscal year 2024–25, a 16 percent increase from the previous year, State Bank of Pakistan (SBP) Governor Jameel Ahmad said on Thursday while chairing a meeting of the Agricultural Credit Advisory Committee (ACAC).

Agricultural financing is considered critical to Pakistan’s rural economy, where farming contributes nearly one-fifth of GDP and employs a large share of the workforce. The government has repeatedly emphasized expanding credit access to small farmers as part of broader efforts to boost productivity, stabilize food supply and support economic recovery under an IMF-backed reform program.

According to official data shared at the meeting, agricultural credit disbursement reached Rs2.58 trillion in FY25, marking a record high. In the first half of FY26 alone, banks disbursed Rs1,412 billion in agricultural loans, while the number of borrowers increased to 2.97 million.

“During fiscal year 2025, record agricultural loans of Rs2.58 trillion were disbursed, reflecting an annual growth of 16 percent,” the State Bank governor said, according to a statement issued after the meeting.

He added that Pakistan had regained macroeconomic stability and that the economy was moving toward sustainable growth.

The governor said GDP growth in the first quarter of FY26 stood at 3.7 percent, while full-year growth was projected between 3.75 percent and 4.75 percent.

He also noted that headline inflation had declined to 5.8 percent in January 2026.

The committee reviewed measures to further expand credit access, including greater use of the central bank’s Zarkhez-e scheme to facilitate agricultural lending. Members also discussed promoting electronic warehouse receipt financing to enhance post-harvest liquidity and reduce distress sales of crops.

The statement said the purpose of electronic warehouse receipt financing was to “reduce forced sales of crops and strengthen linkages within the agricultural market.”

Agricultural lending has been a focus of Pakistan’s financial inclusion strategy, particularly as policymakers seek to improve rural incomes, stabilize food prices and strengthen export-oriented crop production amid broader economic reforms.