What happened

According to a report by Dawn, the government has revised Pakistan's gross domestic product (GDP) growth rate downward to 3.65 per cent for the outgoing fiscal year (FY26). The decision was made during the 118th meeting of the National Accounts Committee (NAC) at the Pakistan Bureau of Statistics. Officials attributed the adjustment to a slight deceleration in both the industrial and services sectors, confirming that the country missed its target. The government had previously lowered its economic growth projection to 3.70 per cent in May 2026, down from an earlier target of 4 per cent.

Key facts

Dawn reported several key economic performance metrics approved during the meeting:

  • Adjusted sector growth rates for FY26 stand at 3.50 per cent for agriculture, 3.34 per cent for industry, and 3.81 per cent for services.
  • The total size of the economy grew to $450.4 billion in FY26, up from $410.96 billion in FY25.
  • Per capita income rose to $1,896 in FY26 from $1,824 in FY25, though it remains the lowest in the region.
  • Quarterly growth rates for FY26 were recorded at 3.89 per cent for the first quarter, 4.31 per cent for the second, 4.42 per cent for the third, and 2 per cent for the fourth quarter.
  • The revised national figure aligns closely with projections from global lenders, including the International Monetary Fund (3.6 per cent), World Bank (3.7 per cent), Asian Development Bank (3.7 per cent), and State Bank of Pakistan (around 3.7 per cent).

Why it matters

According to Dawn, although total economic output and per capita dollar figures increased modestly, high inflationary pressures have significantly reduced disposable incomes. This has weakened purchasing power, savings, and investments, signaling a decline in living standards across most segments of society. Furthermore, several key manufacturing sub-sectors suffered negative growth in FY26, including pharmaceuticals, iron and steel, chemicals, leather products, and electricity.

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Source: Dawn - Home · Published October 20, 2026 · Photo by Morgan Housel on Unsplash