Pakistan’s economy grew 3.7% in fiscal year 2025-26, its highest rate in four years, according to the Economic Survey. The growth signals improving economic stability despite floods, regional tensions, and global uncertainty. Businesses, investors, exporters, and households stand to benefit from the broader recovery.
Finance Minister Muhammad Aurangzeb said the economy showed broad-based recovery across major sectors. He noted that Pakistan reached its largest economic size in history. Per capita income increased to $1,901 during the fiscal year. The agriculture sector expanded by 2.9%, supported by stronger crop production. Meanwhile, 16 of 22 manufacturing sectors recorded growth during the year.
Large-scale manufacturing grew 6.1%, marking its strongest performance in four years. The services sector also achieved its highest growth rate in the same period. Furthermore, the fiscal deficit remained at 0.7% of GDP while the primary balance stayed in surplus. Federal Board of Revenue collections increased 10.1%, reflecting stronger economic activity. The current account also posted a surplus of $72 million.
Aurangzeb highlighted the role of remittances, technology exports, and investor confidence in supporting growth. IT exports reached $4.5 billion, while freelance exports exceeded $900 million. Foreign exchange reserves rose above $17 billion and may surpass $18 billion by June. Additionally, 175,000 new investors entered the equity market. The country also completed 11 initial public offerings, the highest level in two decades.
Planning Minister Ahsan Iqbal said Pakistan still faces structural challenges despite recent gains. He stressed the need for an export-led economy and greater policy continuity. Aurangzeb said the country overcame trade uncertainty, floods, and regional conflict during the year. He added that global firms increased investments despite concerns about business activity. Pakistan-made footballs will also be used in the upcoming FIFA World Cup.