Business Recorder
ISLAMABAD: The Pakistan Institute of Development Economics (PIDE) has found that ministries retain pervasive de facto influence over their regulatory bodies through three primary channels: funding, appointments, and the issuance of policy guidelines, which result in the failure of these bodies to improve governance and accountability. Pursuant to the Prime Minister’s directive, PIDE undertook a study titled “Improving Governance and Accountability: Mechanisms for Separating Regulatory Functions from Ministries.” Upon reviewing the preliminary findings, the Federal Minister for Planning and Development advised that a stakeholders’ consultation be convened to seek feedback and ensure collective ownership of the study. The study further found that eligibility criteria for chief executives and board members were vague, inconsistently applied, or entirely absent in several cases, while renewable tenure provisions created structural conflicts of interest. Beyond the five case studies, a broader survey of 31 federal regulatory bodies revealed five systemic failure patterns, the economic think tank stated. Among the most critical factors identified was a structural conflict of interest in which the regulator and operator were the same entity — a situation persisting in the cases of Pakistan Railways, the Special Technology Zones Authority, and the country’s three major port trusts. PIDE also organized a stakeholders’ consultative roundtable on the subject, bringing together senior representatives from regulatory authorities, federal ministries, the private sector, and academic institutions. Speaking at the event, Dr Nasir Iqbal, Professor at PIDE and co-author of the report, highlighted Pakistan’s persistently declining economic trajectory, noting that the country’s GDP growth rate had fallen from around five percent to three percent over the past three decades, barely keeping pace with population growth. “It is not about closing these entities. It is about empowering them while ensuring that they play a facilitative, rather than restrictive, role for business activity,” he said, stressing that reforms must reduce the cost of doing business and eliminate regulatory hurdles instead of creating new layers of regulation. Dr Mahmood Khalid, Director of Economic Analysis at the Tax Policy Office of the Ministry of Finance and co-author of the report, presented the study’s findings. The research examined five major ministry-regulator pairs — the Power Division and NEPRA, the Petroleum Division and OGRA, the Ministry of Aviation and the Civil Aviation Authority, the Ministry of Information and Broadcasting and PEMRA, and the Ministry of Education and ICT-PEIRA — to identify overlapping mandates and constraints on regulatory independence. The study also identified policy duplication between ministries and attached bodies, fragmentation of standards across multiple agencies without a unified hierarchy, fiscal overreach by non-revenue bodies such as EPZA’s collection of a one percent presumptive tax on exports — a function constitutionally reserved for the FBR — and incomplete or misleading compliance in ministerial responses, with several departments claiming no overlap despite clear contradictions in their own enabling legislation. The roundtable generated extensive discussion among participants and was moderated by Saddam Hussein, Director of the Center for Governance, Markets and Regulatory Analysis (CGMRA) and Deputy Chief Policy at PIDE. NEPRA’s representative advocated the introduction of Regulatory Impact Assessment guidelines across all regulatory bodies to make regulators accountable for the measurable impact of their decisions on investment and ease of doing business. An ICT-PEIRA official, meanwhile, highlighted that the legal frameworks governing most regulatory authorities were largely similar and had not been designed in accordance with each authority’s specific aims and objectives. Hussein, while acknowledging the study’s findings on ministerial overreach, also cautioned against moving to the opposite extreme. “If regulatory bodies are given complete independence, the question of accountability still remains,” he observed. A representative of the Pakistan Business Council also lauded PIDE’s efforts in researching and consulting stakeholders on such an important issue. The consolidated feedback and written recommendations collected during the roundtable will be compiled by PIDE and submitted as a unified policy brief to the Prime Minister’s Office (PMO) and the Ministry of Planning, Development and Special Initiatives. Copyright Business Recorder, 2026
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