ISLAMABAD: Pakistan’s economy posted a growth rate of 3.04 percent during FY2024–25, driven by a strong recovery in the industrial and services sectors, according to revised national accounts approved by the National Accounts Committee (NAC) in its 114th meeting held at the Pakistan Bureau of Statistics (PBS).
The latest estimates show that the country’s gross domestic product (GDP) reached Rs. 113.7 trillion, equivalent to US$ 407.2 billion, up from US$ 371.8 billion in the previous fiscal year. Pakistan’s per capita income also increased to US$ 1,812, reflecting gradual economic recovery and currency stability.
Officials said the economy showed “gradual but broad-based improvement” through FY2024–25, with growth accelerating from 1.8% in the first quarter to 5.66% in the final quarter—the highest quarterly performance recorded in recent years.
Industrial Rebound Leads Growth
The industrial sector was the top contributor to GDP growth, expanding by 5.26% compared to 4.77% last year.
Within the sector:
- Construction activity surged by 63%,
- Electricity, gas, and water supply posted an exceptional 53% growth,
- While Large-Scale Manufacturing (LSM) declined only 69%, showing major improvement from the steep declines of the past two years.
Officials attributed the sector’s rebound to improved power supply, easing inflation, and greater raw material availability, which collectively boosted production in construction, cement, and allied industries.
Agriculture Faces Mixed Results
The agriculture sector recorded modest growth of 1.51%, constrained by a 13.12% decline in major crops such as wheat and cotton. However, minor crops rose sharply by nearly 20%, alongside livestock (3.72%), forestry (3.01%), and fisheries (0.97%), providing overall stability to the rural economy.
Services Sector Sustains Expansion
The services sector—accounting for over half of Pakistan’s GDP—grew 3% during FY2024–25.
Key contributors included:
- Financial and insurance activities (+3.9%)
- Transport and storage (+2.7%)
- Public administration and social security (+9.88%)
Officials said the rise in government spending and expansion of digital financial services supported consistent growth across services industries.
Improving Macroeconomic Indicators
The NAC report also highlighted several encouraging trends:
- National savings rose to 1% of GDP,
- Investment-to-GDP ratio improved to 6%,
- Inflation dropped to 6% from 21.2% last year,
- Fiscal deficit contained at 3% of GDP,
- Current account deficit narrowed to US$ 1.4 billion (0.3% of GDP),
- Foreign exchange reserves climbed to US$ 9.5 billion, offering more than two months of import cover.
Officials noted that these indicators reflect a “turnaround phase” for the economy, supported by consistent fiscal management and better coordination between the finance, planning, and energy ministries.
Quarterly Trend Reflects Recovery Momentum
The quarterly GDP data reflected a steady upward path:
- Q1:80%
- Q2:41%
- Q3:83%
- Q4:66%
Officials at the NAC said this consistent improvement signals “macroeconomic stabilization taking hold,” with momentum expected to carry into FY2025–26 if current policies continue.
PBS Lauded for Data Reforms
The NAC praised the Pakistan Bureau of Statistics for strengthening national accounts methodology and improving quarterly data compilation. Coordination with the Ministry of Finance and the State Bank of Pakistan was cited as crucial for more timely and accurate economic assessments.
Officials concluded that sustaining the current pace of recovery will require continued focus on industrial competitiveness, export diversification, and investment in productivity and technology-led growth.
