Pakistan recorded a GDP growth rate of 2.7 percent in the outgoing fiscal year, missing its official target of 3.6 percent, according to the Economic Survey 2024-25 presented on Monday by Finance Minister Muhammad Aurangzeb, a former banking executive and ex-CEO of one of Pakistan’s leading financial institutions.
Aurangzeb outlined the broader global economic context, noting that world GDP growth was registered at 3.5 percent in 2023, declined to 3.3 percent in 2024, and is forecast to further ease to 2.8 percent, based on the latest projections.
Reflecting on Pakistan’s own economic performance, the minister shared that the country had experienced a GDP contraction of -0.2 percent in 2023, followed by a rebound to 2.5 percent in FY2024, and now reports 2.7 percent growth in FY2025. He characterized this progression as a “gradual recovery”, emphasizing that sustainable, steady growth was preferable to volatile economic cycles.
“In my view, this path represents sustainable development,” Aurangzeb said, adding that avoiding another “boom-and-bust” scenario was a key priority for the administration.
The Finance Minister highlighted the central bank’s policy rate cut from a record 22 percent to 11 percent, which he said saved Rs. 800 billion in debt servicing. Public debt-to-GDP ratio fell from 68 percent to 65 percent, while foreign exchange reserves rose to $9.4 billion by June 30, 2024, up from just two weeks’ import cover in 2023.
Aurangzeb credited the restoration of IMF support under the Stand-by Arrangement to renewed credibility under Prime Minister Shehbaz Sharif’s leadership. He said Pakistan was now seeking an Extended Fund Facility to strengthen macroeconomic stability and implement structural reforms.
The tax-to-GDP ratio reached a five-year high, with revenue rising 26 percent due to digital invoicing, AI-based audits, and faceless customs. The number of individual filers doubled to 3.7 million, while high-value filers increased by 178 percent.
He said recoveries in the power sector had improved, tariff structures were being rationalised, and professional boards had been appointed in distribution companies. The government remains committed to resolving the Rs. 1.275 trillion circular debt and is proceeding with the privatisation of 24 state-owned enterprises, led by PM’s adviser Mohammad Ali.
The minister said debt management had shifted from desperation to strategy. The government repaid Rs. 1 trillion in domestic debt and extended the average maturity by 66 percent to reduce refinancing risks. He said banks must now shift focus toward private sector lending.
Industrial growth rose to 4.8 percent in FY25, reversing last year’s 1.4 percent contraction. Construction grew by 6.6 percent, electricity, gas, and water supply improved, and small-scale manufacturing posted modest gains. Large-scale manufacturing remained in decline, but the auto and textile sectors showed signs of recovery.
Services grew by 2.9 percent, up from 2.2 percent last year, driven by a 6.5 percent rise in information and communication and 4.1 percent in food services. Transport activity rose due to higher port and airline usage. Agriculture grew by only 0.6 percent, dragged down by a 13.5 percent drop in major crops, although livestock (4.7 percent), poultry (8.1 percent), and fruits and vegetables (4.8 percent) performed strongly.
Aurangzeb said the government is gradually exiting the market for major crops such as rice and maize and suggested dismantling Passco. He emphasised investment in storage infrastructure and praised Punjab’s electronic warehouse initiative.
Agricultural credit rose by 16 percent from July 2024 to April 2025, crossing Rs. 2 trillion. The focus remains on mechanisation and improved seed technology.
The current account posted a $1.9 billion surplus from July 2024 to April 2025, compared to a $1.3 billion deficit the previous year. Exports rose 7 percent, led by IT and freelancers, who contributed nearly $400 million. Imports increased by 12 percent, driven by higher machinery and transport equipment inflows.
Remittances grew by 31 percent year-on-year, with a record $4.1 billion received in March. Full-year inflows are projected to reach $37–38 billion, up from $31 billion last year. Inflows through the Roshan Digital Account crossed $10 billion, with 814,000 accounts opened.
Aurangzeb said FY25 marked a turning point, led by macroeconomic stabilisation, reform momentum, and strong external inflows. Budget details will be presented on Tuesday.
The Economic Survey—an annual pre-budget report—offers a detailed overview of Pakistan’s economic indicators and serves as a foundation for policymaking and public discourse ahead of the national budget. This year’s federal budget for FY 2025-26 is scheduled to be unveiled on Tuesday, June 10.
Originally slated for release on June 1 and June 2, respectively, both the Economic Survey and the budget presentation were rescheduled to June 6 and June 7, before being pushed forward again.
During a recent National Economic Council (NEC) meeting held on Wednesday, officials endorsed the 2.7 percent GDP growth figure for FY2024-25 and approved a growth target of 4.2 percent for the upcoming fiscal year. The NEC also reviewed key financial metrics and development spending.
The Council was informed that Rs. 3.483 trillion had been allocated for public sector development, with Rs. 1.1 trillion coming from the federal government and Rs. 2.383 trillion from provincial budgets.
Other key highlights included a 30.9 percent rise in remittances between July 2024 and April 2025, along with a positive current account balance for the first time in several years—signaling improving external sector dynamics.
On the fiscal front, the budget deficit narrowed to 2.6 percent of GDP, while the primary balance remained in surplus at 3 percent of GDP, underscoring improved fiscal discipline as the government continues efforts to stabilize the economy.
Reference Link:- https://propakistani.pk/2025/06/09/govt-unveils-economic-survey-2024-25/