The coronavirus outbreak, which is originated in China, has inflected more than 1.5 million people around the globe. The life in every field has stuck for the last one month which as a result affected the economic conditions of all the countries. Financial markets remain turbulent as a massive slowdown in economic activity due to the coronavirus takes hold across Europe and the US. Global stock markets have sunk despite the central banks around the world revealing a coordinated effort to ease the drift of the coronavirus. According to the data published by the Economist Intelligent Unit, they revised the growth forecast of all the countries and as per their statistics, they show a decrease in growth of every country roughly by 5-6%. In short, the coronavirus has adversely affected all the markets around the world. Pakistan’s economy has also influenced due to the coronavirus infection. It has been witnessed as a number of cases are increasing every day. The government is taking serious measures to cope up with the issue. The overall position of entire economy is not good. There has been a massive decline in stock prices which makes stock market more volatile. The graph shows a substantial decline in returns over the last two months. A number of initiatives took by the government which are really commendable including (a) cut in policy rate by 2.25% which makes present rate at 11%, (b) decline in the prices of gasoline and diesel, (c) provide tax rebate of 100 billion rupees ($630 million) for the export sector, (d) low income families will get cash payment of 3,000 rupees per month for the next four months, (e) ease in submission of electricity and gas bills, (f) taxes on items such as sugar and wheat will be reduced, (g) close the boarders for two weeks to prevent the virus, (h) suspension of all international flights to and from the country, and (i) establishment of Corona tiger force to deliver food for poor community. These steps eventually help to overcome the adverse situation and provide relieve up to some extent to the business community. When the corona problem will be over and the economy starts to recover, those who had received various subsides and special loans should return their received benefits to the central government Fig. Impact of coronavirus on the Pakistani Stock Market Besides the above initiatives, the government has to do more in order to bring fiscal stimulus against coronavirus shocks, therefore, it is proposed that interest rate should be curtailed to 6-7% in order to promote financing. The cheaper financing will increase business activities and help to increase growth of the country. This will also reduce the burden on the budget deficit. Government should provide subsidies to food items, and ensure the availability of necessary items in the marketplace. In order to support various government spending “Corona” bond can be issued mainly purchased by the central bank in order to make emergency spending by the government. The corona bond can be a zero-coupon bond where only central bank purchases them which will reduce interest burden for the central bank. To create loan against the proposed bonds, the government should clearly year marked as Corona spending by the government so receiver for those subsidies to be realized by Corona bonds. The extra spending of the government can also be financed through Corona bonds which can be purchased by the central bank. As this crisis over, these bonds can be financed by tax payers money. Government can provide emergency loans to the services and manufacturing sectors whose sales have fallen due to the coronavirus. The proposal of Corona bonds is also beneficial through which financing can be provided to other sectors of the economy. Banks must comply with the Basel capital requirements. However, in this case of emergency, borrowers face difficulty to fulfill their obligations and there is a likelihood that banks may face default risk. These risks can be managed by the State Bank by exempting them from the Basel capital requirements. They can also be categorized as special Corona bank loans and are year marked under different modes of loan. Direct compensation should be made to workers in various companies who are forced to stay at home due to the coronavirus. The delivery pattern of education to be changed drastically. Thus, government agencies are required to develop guidelines for this new mode of teaching. Moreover, the stock market is allowed for two to three hours of trading activities which creates lesser volatility in the market. Corona infection will be a one-time phenomenon that might last for 6 months or longer. Special government spending and loans have to be identified as corona emergency spending by receivers. When the corona problem will be over and the economy starts to recover, those who had received various subsides and special loans should return their received benefits to the central government. Emergency government spending is urgently needed at the same time how to return those corona bonds have to be taken into account to bring back huge government debt into the normal level. These measures may help to bring fiscal stimulus and prevent shocks from the Coronavirus in Pakistan. The writers are associated with the School of Social Sciences and Humanities, National University of Sciences & Technology (NUST), Islamabad and Keio University, Tokyo, Japan