🇵🇰 PKR vs 🇦🇪 AED: Inflation & Currency Impact (2023–2025)
| Metric | Pakistan (PKR) | UAE (AED) |
|---|---|---|
| Avg. Annual Inflation (est.) | ~25% (2023), ~20% (2024), ~15% (2025) | ~3.5% avg |
| Currency Depreciation vs AED | ~15% over 12 months | AED is pegged to USD |
| Real Return Adjustment | Subtract inflation from net yield | Subtract UAE inflation |
🔍 Adjusted Real Returns (Post-Tax, Post-Inflation)
| Instrument | Net Yield (PKR) | Est. Real Return (2025) |
|---|---|---|
| Behbood/Pensioner’s (PK) | 11.42% | ~–3.6% (after 15% inflation) |
| Special Savings Cert. (PK) | 9.27–10.12% | ~–5.7% to –4.9% |
| UAE National Bonds (AED) | ~10.2% (in PKR) | ~6.7% (after 3.5% inflation) |
💡 In real terms, UAE National Bonds currently outperform Pakistani savings instruments due to lower inflation and currency stability.
Would you like a projection model showing how PKR 1 million would grow (or shrink) in real terms across these options over 3–5 years? I can chart it out for you.
Awesome — here’s a real return projection over 5 years, comparing the options:
📈 Real Value Projection of PKR 1 Million (2025–2030)
| Year | Behbood/Pensioner (PK) | Special Savings (PK) | UAE National Bonds (AED) |
|---|---|---|---|
| 2025 | 1,000,000 | 1,000,000 | 1,000,000 |
| 2026 | 964,000 | 951,000 | 1,067,000 |
| 2027 | 929,000 | 905,000 | 1,140,000 |
| 2028 | 894,000 | 861,000 | 1,219,000 |
| 2029 | 861,000 | 819,000 | 1,303,000 |
| 2030 | 829,000 | 778,000 | 1,392,000 |
📌 Assumptions:
- Pakistan inflation at 15% annually
- UAE inflation at 3.5% annually
- Compounding net returns annually
- Exchange rate remains constant (to isolate inflation impact)
So, in real terms, UAE National Bonds preserve and grow purchasing power, while PK-based options struggle to beat inflation under current conditions. Of course, this doesn’t include currency risk or individual access constraints.
Here’s a head-to-head comparison of PSX KSE-100 Index Funds versus Pakistan Savings Certificates and UAE National Bonds, factoring in all taxes and real returns (adjusted for inflation):
📊 Investment Comparison: Real Returns After Tax & Inflation (2025)
| Instrument | Gross Return | Tax Rate | Net Return | Inflation Adj. | Real Return |
|---|---|---|---|---|---|
| KSE-100 Index Fund (PK) | ~18% | 15% CGT | 15.3% | –15% PK | ~0.3% |
| Behbood/Pensioner Cert. (PK) | 13.44% | 15% WHT | 11.42% | –15% PK | –3.6% |
| Special Savings Cert. (PK) | 10.9–11.9% | 15% WHT | 9.27–10.12% | –15% PK | –5.7% to –4.9% |
| UAE National Bonds (AED) | ~12% | 0% | ~12% | –3.5% UAE | ~8.5% |
🧾 Capital Gains Tax (CGT) on equities in Pakistan remains at 15% for filers. Savings instruments are subject to 15% withholding tax. UAE National Bonds are tax-free for individuals.
🧠 Strategic Insight for You, Khawar
- KSE-100 Index Funds are currently the only PKR-based option with a positive real return, assuming the market sustains its ~18% growth.
- UAE National Bonds still outperform due to low inflation and no taxes, but they carry currency and access risks.
- Savings certificates are safe but lose value in real terms under current inflation.
Comparing to real estate in Karachi.
5.5 Million apartment. Rent is PKR 20,000 per month. ROI on rent without taxes and other maintenance is 21.66 Years. This is like 4.5% per year on PKR.
P.S.
If you want something better. Then ask us about the 6-25-75 offer. But be ready to invest for at least 3 years minimum.
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