Pakistan anticipates its economy to grow by 2.7% in the fiscal year ending June 2025, following a 2.5% expansion in the previous year, according to the government’s annual economic performance report. Initially targeting 3.6% growth in GDP for this financial year, the government revised its forecast downward to 2.7% last month. The International Monetary Fund projects growth at 2.6% for this year and 3.6% for the next. Prime Minister Shehbaz Sharif’s administration aims for 4.2% growth in the upcoming fiscal year while balancing priorities such as investment, maintaining a primary surplus, and managing defense spending amid regional tensions. Finance Minister Muhammad Aurangzeb emphasized avoiding rapid consumption-led growth to prevent import surges and balance of payments issues. Agricultural sector growth hit a nine-year low of 0.6%, impacted by adverse weather. Meanwhile, government revenue rose by 36.7% in the first three quarters of fiscal 2025, and the country reported a current account surplus of $1.9 billion. The central bank has cut interest rates significantly to encourage growth, reducing the key rate to 11%.
— new from Reuters
