Islamabad: Pakistan’s economy has expanded by three per cent in fiscal year 2025 (FY25), and the growth rate is expected to remain the same in the next fiscal year, the World Bank said on Tuesday.
The bank launched its latest report called ‘Pakistan Development Update: Staying the Course for Growth and Jobs’, highlighting the hopes and apprehensions surrounding the Pakistan economy.
“Pakistan’s economy expanded by 3.0 per cent in the fiscal year ending June 2025, up from 2.6 per cent in the previous year, reflecting a rebound in industrial activity and an expansion in the services sector,” it said, adding that the growth is projected to remain at 3 per cent for the fiscal year ending in June 2026.
It added that the sluggish growth in FY 2026 is due to the impacts of recent floods on the agriculture sector, before picking up in the medium term as ongoing stability and continued reforms enhance growth prospects.
Citing the reasons behind the expansion, the World Bank stated that Fiscal tightening and appropriate monetary policy helped anchor inflation and support current account and primary fiscal surpluses amidst a challenging global and domestic environment.
Improved confidence supported industry and service sector growth, even as agriculture growth underperformed, in part due to adverse weather and pest infestations, it added.
However, it cautioned that while the outlook remained favorable, it has also been tempered by recent floods, which have resulted in a significant impact on people and damage to urban areas and agricultural land
