World Bank Projects Pakistan GDP Growth at 3%
Pakistan’s GDP Growth Forecast Slower Than Government Estimate
ISLAMABAD: (Web Desk) – The World Bank (WB) has projected Pakistan’s GDP growth at 3% for the current fiscal year, significantly lower than the government’s official estimate of 4.2%, according to its latest Global Economic Prospects report.
The report forecasts Pakistan’s growth to remain at 3% in FY2025/26 (July 2025–June 2026) before improving slightly to 3.4% in FY2026/27. The expected recovery is linked to improved agricultural output and reconstruction activity following the devastating floods of 2025.
The World Bank noted that deeper structural and regulatory reforms could provide further upside. In Pakistan, reforms aimed at boosting private sector activity may help reduce informality and generate employment.
Economic activity has shown signs of improvement, particularly in the industrial sector, supported by a relaxation of import restrictions and expanded bank credit amid easing financial conditions.
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Among oil-importing nations, Pakistan’s current account balance has improved, partly due to higher remittances and tourism revenues. However, the Bank warned that further increases in US tariffs could hurt exports, especially for economies like Pakistan with concentrated export markets.
Despite near-term stability, Pakistan’s current account deficit is expected to widen in FY2026/27, driven by rising import demand as growth strengthens and remittance inflows normalize after post-flood surges.
The report underscores that while recovery is underway, sustained reforms and external stability will remain critical for Pakistan’s economic outlook.
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