Pakistan’s economy has underperformed against official expectations in the 2024-25 fiscal year, managing just a 2.68 percent expansion—well below the government’s 3.6 percent growth objective—according to sources quoted by ARY News during Tuesday’s National Accounts Committee session. Chaired by the Secretary of Planning, the meeting laid bare the shortfall as policymakers grapple with sluggish output and mounting financing needs.
The country’s gross domestic product reached USD 411 billion, while per-person income rose to USD 1,824. Yet sectoral results painted a mixed picture: agriculture eked out only 1.8 percent growth in the first three quarters, dragged down by erratic weather and high input costs; the industrial segment contracted by 1.14 percent, reflecting weak domestic manufacturing demand; and services surged an impressive 39 percent between July and March, buoyed by telecommunications, retail trade, and transport services.
Faced with constrained domestic resources, Islamabad is now preparing to tap international credit markets for USD 4.9 billion to bridge its financing gap in 2025-26. Plans call for USD 2.64 billion in short-term loans from commercial banks at an anticipated 7–8 percent interest rate, structured without stringent policy conditions. A further USD 2.27 billion is expected via longer-dated facilities.
Negotiations are reportedly in advanced stages with four global lenders: a USD 1.1 billion line of credit from the Industrial and Commercial Bank of China (ICBC), USD 500 million tranches each from Standard Chartered and Dubai Islamic Bank, and a USD 500 million loan backed by a commercial guarantee from the Asian Development Bank.
Meanwhile, the International Monetary Fund has set a benchmark for Pakistan to bolster its foreign exchange reserves to USD 13.9 billion by end-June. The State Bank of Pakistan’s net reserves hover around USD 14 billion—equivalent to roughly three months’ import cover—providing a cushion as Islamabad navigates fiscal pressures and seeks to restore investor confidence.
