ISLAMABAD: Pakistan’s economy has reached its largest recorded size, expanding to US$452.1 billion in FY2026, according to the Pakistan Economic Survey 2025-26, underscoring a significant recovery from the economic challenges faced just a few years ago.
The latest figure represents a sharp increase from US$337 billion in FY2023 and US$372 billion in FY2024, reflecting a sustained improvement in economic activity across major sectors. The Ministry of Finance described the milestone as the largest economic size recorded in the country’s history.
The growth has been supported by stronger performance in agriculture, industry and services. Overall GDP growth stood at 3.7 per cent in FY2026, compared with a contraction of 0.2 per cent in FY2023. Agriculture expanded by 2.89 per cent despite weather-related challenges, while industrial output grew by 3.51 per cent.
Large-scale manufacturing, which had contracted by 9.8 per cent in FY2023, recorded growth of 6.1 per cent during the current fiscal year, indicating a broad-based recovery in industrial production. The services sector remained a key contributor to economic activity, expanding by 4.09 per cent.
The survey also showed improvements in household incomes, with per capita income rising to US$1,901 from US$1,547 in FY2023.
Economic stability indicators improved alongside growth. Average inflation fell to 6.7 per cent from 29.2 per cent three years earlier, while foreign exchange reserves increased to US$17.2 billion. The current account deficit narrowed sharply to US$252 million, compared with US$17.4 billion in FY2022.
Officials say ongoing reforms in taxation, energy, state-owned enterprises, digital governance and investment facilitation are helping strengthen economic fundamentals. Rising private-sector credit, record investor participation and increased business registrations further point to growing confidence in the country’s economic outlook.
