Pakistan Misses Most Economic Targets for FY2025-26, Growth Expected at 3.7%

Islamabad: The federal government is expected to fall short of most of its key economic targets for fiscal year 2025-26, including the overall economic growth target, according to details emerging ahead of the release of the Economic Survey.

The government is set to publish the Economic Survey for the outgoing fiscal year tomorrow, outlining the country’s economic performance and major indicators.

According to sources, Pakistan’s economic growth rate is estimated at 3.7%, below the official target of 4.2%. International financial institutions, including the International Monetary Fund, World Bank, and Asian Development Bank, had also projected lower-than-target growth for the year.

Sources said targets related to per capita income, agriculture, and industrial growth were not achieved. However, remittances and the services sector performed better than expected.

Average inflation during the first 11 months of the fiscal year stood at 7%, below the annual target of 7.5%. However, monthly inflation reportedly rose to 11.66% in May.

Per capita income was targeted at Rs560,803 for the fiscal year, but is expected to remain around Rs533,629. In dollar terms, however, per capita income increased by approximately $150 to reach $1,901.

The agricultural sector is estimated to have grown by 2.89%, falling short of the 4.5% target, while industrial growth is expected at 3.51% against a target of 4.3%.

In contrast, the services sector is projected to grow by 4.09%, slightly exceeding the 4% target.

Remittances recorded strong growth of 9%, reaching $38 billion during the first 11 months of the fiscal year. The figure is expected to rise to $41 billion by the end of June.

Export performance remained below target, with goods exports reaching $28 billion during the first 11 months against the annual target of $35.3 billion. Imports totaled $63 billion during the July–May period, compared to a target of $65.2 billion.

Officials expect that final trade figures for June may help narrow the gap and bring export and import numbers closer to their annual targets when the complete fiscal year data becomes available.