Pakistan’s Economy Shows Strong Performance Despite Challenges, Says Finance Minister Aurangzeb

Islamabad (Kudrat Daily) — Federal Finance Minister Muhammad Aurangzeb has said that Pakistan’s economy demonstrated resilience and delivered improved performance despite facing significant domestic and international challenges during the fiscal year.

Presenting the National Economic Survey in Islamabad, Aurangzeb stated that the country faced uncertainty at the beginning of the fiscal year, with monsoon rains affecting economic activity. He added that global uncertainty increased after the United States imposed tariffs on several countries, creating additional economic pressures worldwide.

The finance minister said Pakistan successfully navigated these challenges and maintained economic stability. He noted that the country’s economic growth rate reached 3.7 percent, slightly below expectations of over 4 percent. He added that the ongoing crisis in the Middle East also impacted global economic conditions.

According to Aurangzeb, Pakistan’s economy expanded to more than $452.1 billion, while per capita annual income increased from $1,751 to $1,901. He said GDP growth could have exceeded 4 percent had regional geopolitical tensions not affected economic activity.

The minister highlighted growth in key sectors, including 10 percent growth in the cement industry, 17 percent growth in the fertilizer sector, and 5 percent growth in the petroleum sector. Agricultural growth was recorded at 2.89 percent, with dairy and livestock contributing nearly 60 percent to the agricultural economy.

Aurangzeb said Pakistan’s current account remained positive at $72 million from July to March, while the current account deficit narrowed significantly to $252 million. Foreign exchange reserves reached $17.2 billion by May 29, 2026, marking a 49 percent annual increase, and are expected to rise to $18 billion by the end of June.

He also noted strong growth in the digital economy, revealing that freelance exports reached $900 million, while IT and technology exports climbed to $3.8 billion during July-April. Freelancers contributed approximately $959 million to overall IT exports.

The finance minister stated that overseas Pakistanis sent a record $33.9 billion in remittances during July-May, including a historic $4.3 billion in April 2026 alone. He thanked overseas Pakistanis for their continued support, describing remittances as crucial for external payments and economic stability.

Aurangzeb further said inflation has declined significantly from previous highs, with average inflation recorded at 6.7 percent during July-May. Fiscal discipline helped reduce the fiscal deficit, while the primary surplus reached 3.2 percent of GDP. Pakistan’s total debt-to-GDP ratio also declined to 68.5 percent.

The minister highlighted improvements in the business environment, noting that 11 new companies were listed on the stock exchange during the year, while more than 39,000 new companies were registered nationwide, bringing the total number of registered companies to over 297,000.

He added that private-sector lending increased by Rs934 billion between July and March, while agricultural financing reached Rs2.162 trillion. The government also increased the budget of the Benazir Income Support Programme to Rs722.5 billion and accelerated the privatization of state-owned enterprises, including Pakistan International Airlines and other public-sector entities.

The finance minister concluded that improved revenue collection, rising remittances, lower inflation, and stronger foreign exchange reserves reflect the economy’s recovery and provide a foundation for sustainable growth in the coming years.