According to the latest economic survey of Pakistan, in the latest World Economic Outlook (WEO) of April 2026, the IMF revised the global growth viewpoint downward following the outbreak of war in the Middle East and the resulting disruptions in energy markets, trade flows, and financial situations. Global growth, estimated at 3.4 percent in 2025, is projected to slow to 3.1 percent in 2026, then recover slightly to 3.2 percent in 2027. The downgrade reflects heightened geopolitical tensions, elevated energy and food prices, tighter financial situations, and persistent trade fragmentation. Global headline inflation, after declining to 4.1 percent in 2025, is projected to rise again to 4.4 percent in 2026, then moderate to 3.7 percent in 2027, largely because of higher commodity prices and renewed supply-side pressures. Advanced economies are expected to experience modest growth slowdowns, with stronger resilience in net energy exporters like the United States and Canada, while energy-importing economies, including the Euro area, Japan, and the United Kingdom, are likely to face weaker growth prospects. Emerging markets and developing economies remain more vulnerable to the conflict due to their greater exposure to energy price shocks, remittance fluctuations, and tightening financial situations. For Pakistan, the economic outlook remains closely tied to evolving global economic situations. The WEO projects Pakistan’s real GDP growth at 3.6 percent for FY2026, a modest upward revision from 3.2 percent, and a GDP growth of 3.5 percent in FY2027, down from an earlier projection of 4.1 percent. Experts mentioned in the survey that the revised viewpoint suggests a slightly stronger near term growth momentum, supported by the industrial sector. However, the moderation in FY2027 underscores the expected adverse impact of elevated global energy prices, subdued international trade growth, and continued uncertainty in worldwide financial markets. Headline inflation is forecast at 7.2 percent for FY2026, above SBP’s target range, mentioning persistent cost pressures. On the external front, the current account deficit is projected to widen from 0.4 percent of GDP in FY 2026 to 0.9 percent in FY2027, driven by higher oil import costs and moderating remittance growth. The uncertainty surrounding global economic situations, mainly in major trading partners like the United States, China, and the United Kingdom, carries significant implications for Pakistan’s economy. For instance, escalating geopolitical tensions and weakening global trade activity could influence export demand and investment sentiments, with potential spillovers into emerging markets like Pakistan. In addition, fluctuations in global risk premiums and financial market dynamics may exert pressure on external financing costs and the exchange rate, limiting Pakistan’s efforts to stabilize its macroeconomic environment. Potential disruptions in remittance inflows from the Middle East region also remain a key concern if regional economic activity weakens further. Moreover, increasing geopolitical uncertainty and climate-related vulnerabilities continue to highlight the importance of strengthening economic resilience and maintaining reform momentum. In response, the Government is prioritizing the continuation of structural reforms, prudent fiscal management, and proactive engagement with international partners for achieving durable and inclusive economic growth in Pakistan.
| Gross Domestic Product of Pakistan (at constant basic prices of 2015-16) (Rs. Million) | |||
|---|---|---|---|
| S. No | Sector/Industry | 2024-25 | 2025-26 |
| GDP Growth Rate (%) | 3.18 | 3.70 | |
| A | Agriculture, Forestry and Fishing (1 to 4) | 9,695,601 | 9,975,844 |
| 1. Crops ( i+ii+iii) | 3,344,297 | 3,392,543 | |
| 2. Livestock | 6,004,012 | 6,229,439 | |
| 3. Forestry | 221,160 | 225,632 | |
| 4. Fishing | 126,132 | 128,230 | |
| B | Industrial Activities (1 to 4) | 7,457,780 | 7,719,584 |
| 1. Mining and Quarrying | 591,904 | 594,170 | |
| 2. Manufacturing ( i+ii+iii) | 4,841,123 | 5,161,262 | |
| 3 Electricity, Gas and Water supply | 1,079,575 | 964,834 | |
| 4. Construction | 945,178 | 999,318 | |
| Commodity Producing Activities (A+B) | 17,153,381 | 17,695,428 | |
| C | Services (1 to 10) | 23,889,066 | 24,866,359 |
| 1. Wholesale & Retail trade | 7,304,749 | 7,576,098 | |
| 2. Transportation & Storage | 4,306,820 | 4,406,453 | |
| 3. Accommodation and Food Services Activities (Hotels & Restaurants) | 610,324 | 634,375 | |
| 4. Information and Communication | 1,248,721 | 1,342,621 | |
| 5. Financial and Insurance Activities | 624,443 | 626,432 | |
| 6. Real Estate Activities (OD) | 2,407,856 | 2,495,256 | |
| 7. Public Administration and Social Security (General Government) | 1,740,090 | 1,888,728 | |
| 8. Education | 1,291,819 | 1,359,431 | |
| 9. Human Health and Social Work Activities | 700,830 | 748,857 | |
| 10. Other Private Services | 3,653,413 | 3,788,108 | |
| D | GDP {Total of GVA at bp (A+B+C) | 41,042,447 | 42,561,787 |
| G | GDP at mp (GVA+T-S) | 43,664,526 | 45,758,744 |
| H | Net Primary Income (NPI) | 4,160,240 | 4,019,288 |
| I | Gross National Income | 47,824,766 | 49,778,032 |
| J | GDP (at Current Market Prices) | 114,039,352 | 126,870,134 |
Despite facing external sector uncertainties and domestic challenges, experts also recorded that the Pakistan’s economy has maintained a path of gradual stabilization and growth during FY2026. This performance was supported by disciplined macroeconomic management, improved fiscal balances, exchange rate stability, and broadly contained inflation. Real GDP growth for FY 2027 is projected to continue its upward trajectory, supported by the consistent implementation of pro-growth reforms. Growth in FY 2026 reached at 3.7 percent, up from 3.18 percent last year. Inflation remained contained for most of FY 2026, but escalating global energy prices linked to the Middle East conflict pushed headline inflation to 7.3 percent in March 2026. In response, the SBP raised its policy rate by 100 basis points to 11.5 percent in April 2026, the first hike in nearly three years, to anchor inflation expectations. Over the medium term, the government’s reform agenda is expected to reinforce macroeconomic stability and strengthen the economy’s growth potential, with a focus on SME development, energy sector transformation, digitalization, and gradual export enhancement. Nevertheless, global uncertainties, particularly ongoing conflicts and oil price volatility, may influence inflation and macroeconomic conditions in the near term, requiring continued policy vigilance. Despite these challenges, continued policy discipline and structural reforms are expected to strengthen resilience and competitiveness, supporting sustainable and inclusive economic growth over the medium term.