Islamabad — Pakistan Prime Minister Shehbaz Sharif recently announced that the escalating conflict between the United States and Iran has reversed two years of economic progress for Pakistan, placing significant strain on the country’s financial resources.
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Addressing a cabinet meeting, Sharif stated that the sudden spike in global tensions has driven up Pakistan’s oil import bill to $800 million, up from $300 million prior to the conflict. While Sharif noted that there has been a recent reduction in domestic petroleum consumption, the economic pressure remains high.
“Allah Almighty had placed our economy on a macro level, and we were growing in numbers, but as a result of this sudden war, our efforts made in the last two years have gone down,” Sharif stated. A specialized task force has been formed to monitor the daily economic and regional developments.
Diplomatic Mediation Efforts
Despite the economic fallout, the Pakistani government is taking a proactive role in promoting regional stability. Prime Minister Sharif briefed the Cabinet on Pakistan’s diplomatic efforts to de-escalate the West Asia crisis, highlighting marathon 21-hour talks held between the US and Iran in Islamabad on April 11.
These coordinated efforts—involving senior officials, including Deputy Prime Minister/Foreign Minister Ishaq Dar and Field Marshal Asim Munir—have successfully helped extend the ceasefire between the United States and Iran.
In recent diplomatic engagements, Iranian Foreign Minister Abbas Araghchi traveled to Islamabad for multiple rounds of talks, including a two-hour meeting with Prime Minister Sharif. Pakistan is now planning to host a second round of negotiations between US and Iranian officials to help find a peaceful resolution.
Background of the Conflict
The current escalation began on February 28 when a joint US-Israeli strike on Iran resulted in the death of Supreme Leader Ali Khamenei and several top commanders. The retaliation from Iran rapidly expanded the conflict across the Gulf region. In response, US President Donald Trump recently extended an indefinite ceasefire to allow Tehran time to prepare a unified proposal to end the war.