KARACHI: Despite upbeat indicators, the respondents of the Business Confidence Survey Wave 28 conducted by Overseas Investors Chambers of Commerce and Industry (OICCI) identified persistent challenges, including taxation, inflation, rupee devaluation, corruption, and inconsistent government policies, among the key concerns.

“These remain the top threats to sustained business growth,” the survey said, despite claiming that Pakistan’s business sentiment has strengthened notably, with the Business Confidence Index (BCI) showing an 11 percentage-point rise, pushing the overall confidence level to 22pc.

The latest survey, covering businesses that represent nearly 80pc of the country’s GDP, also highlights a significant shift towards innovation, with 43pc of OICCI members already adopting generative AI technologies and 81pc expecting AI to take over key business functions in the near future.

In a development not seen in nearly a decade, the services sector has posted its highest sectoral score since 2017, registering a record uplift of 24pc. The retail sector followed with a 15pc improvement, while manufacturing recorded a modest 1pc increase. Metro cities rose from 14pc to 23pc, and non-metro locations, from minus 3pc to 19pc, indicating broad-based geographical recovery.

OICCI survey shows taxation, inflation, rupee slide and policy inconsistencies still clouding economic outlook

However, the manufacturing sector’s marginal rise highlights the need for focused efforts to support industrial competitiveness and cost stability. Sustaining this upward trajectory will require continued attention to the structural issues affecting manufacturing so that confidence can strengthen across all segments of the economy.

According to a press release, OICCI members, in particular, registered a notable improvement in sentiment, with their confidence level increasing from plus 17pc in the previous wave to plus 27pc, a climb attributed to an optimistic outlook regarding investment and operational expansion in the coming period.

Forward-looking indicators also show strong momentum, with businesses reporting clearer growth plans for the next six months. The New Orders (Expansion) Index rose sharply to 41pc from 26pc, driven by the services sector’s jump from 23pc to 47pc and the retail sector’s rise from 14pc to 41pc.

The manufacturing posted a modest improvement from 36pc to 37pc. Hiring expectations strengthened as well, with the New Jobs Index increasing to 16pc from 13pc, underpinned by a 21-point surge in services sector hiring plans, from 8pc to 29pc. Investment sentiment recorded a notable turnaround: the New Investment Index improved from minus four per cent to plus 12pc, led by strong rebounds in both the services and manufacturing sectors.

Published in Dawn, December 4th, 2025