Pakistan to set ambitious 4.4% growth target for FY26

Pakistan is projecting a stronger economic performance in fiscal year 2025–26, with an expected growth target of 4.4% as the government banks on a recovery in industrial activity, lower interest rates and an improved geopolitical environment.

The growth targets will be finalized by the National Economic Council ahead of the federal budget announcement next month, government sources said.

According to initial projections, the agriculture sector is expected to grow by 4.8%, while industrial output and the services sector are each forecast to expand by 4.8% and 4.3%, respectively.

For the current fiscal year, the government had set a GDP growth target of 3.6%, with agriculture expected to expand by 2%, industrial output by 4.4% and services by 4.1%.

The State Bank of Pakistan (SBP) recently maintained its real GDP growth forecast for the current fiscal year (FY25) at 2.5% to 3.5%, with the upper end of that range deemed more likely. The central bank expects growth to be supported by sustained momentum in remittances and exports, which continue to outpace the rise in imports.