Finance Minister Muhammad Aurangzeb unveiled the Pakistan Economic Survey 2024-25 on Monday, exuding confidence that the country’s economy would be able to post growth of 2.7 per cent in the outgoing fiscal year for the gross domestic product (GDP).
The National Accounts Committee showed Pakistan’s GDP growth at 1.37pc for the first quarter of FY25, 1.53pc for the second, and 2.4 for the third. This implies that the economy would need to post a growth rate of 5.5pc in the three months of April-June to get to the 2.7pc figure announced by the finance minister.
The GDP growth figure, however, is still lower than 3.6pc, marking the third successive year of the government missing its targeted figure.
Highlights from PES 2024-25
Growth targets missed with only industrial sector slightly above target
Per capita income increases to $1,824 from $1,662
Current account balance notches surplus of $1.9bn from July to April compared to $1.3bn deficit last year
Inflation drops to 4.7pc from targeted 12pc and last year’s 23.4pc
When asked by a reporter about the ambitious figure, Aurangzeb justified the projection by saying that these were official estimates.
“The data provided is by the government,” he said. “Therefore, we will stick to what the government has said and provided. I am going to stay with this.”
The survey is a pre-budget document that contains details of major socio-economic achievements during the outgoing fiscal year. It serves as a vital document ahead of the annual federal budget, which will be presented tomorrow (Tuesday), offering detailed insights into the country’s socio-economic performance over the outgoing fiscal year.
The finance minister, during a press conference in Islamabad, talked about the global economic outlook, noting that global GDP growth was estimated to decline to 2.8pc in 2025 from 3.5pc two years ago.
“Our recovery needs to be looked at in a global context,” he said.
Aurangzeb said Pakistan’s GDP growth in 2023 was negative 0.2pc, which rose to 2.5pc in 2024. “This year, we announced a 2.7pc growth for 2025. This is a gradual recovery and the right way to go about it is to focus on sustainable growth.
“The last thing we want is to go through another round of boom and bust cycles,” Aurangzeb stressed.
According to the survey, the agriculture sector played an “essential and sustainable role” in ensuring food security, supporting rural livelihoods, and fostering national economic resilience, accounting for 23.54pc of the GDP in FY25 and employing over 37pc of the labour force.
“Despite challenging climatic conditions, the agricultural sector demonstrated a positive growth rate of 0.56pc, highlighting its inherent resilience and adherence to historical trends,” the survey said.
It added that livestock emerged as the primary contributor, achieving an expansion of 4.72pc, reinforcing its significant role in agricultural value addition.
Similarly, the fisheries and forestry sub-sectors exhibited steady growth rates of 1.42pc and 3.03pc, respectively, bolstered by “favourable policy measures and prevailing market dynamics”.
The crops sub-sector also experienced a contraction of 6.82pc, primarily driven by a 13.49pc decline in key crops and a 19.03pc decrease in cotton ginning.
The survey said these downturns could be attributed to adverse weather conditions and reduced sowing areas. “Nevertheless, a growth of 4.78pc in other crops indicates the potential for crop diversification and demonstrates resilience in the face of challenging circumstances,” it added.
Industrial growth for FY2024-25 was 4.8pc, compared to negative 1.4pc the previous year, the finance chief said.
“In addition to electricity, gas and water, construction went up by 6.6pc,” he stated.
Aurangzeb observed that while small-scale manufacturing had grown by 1.3pc, large-scale manufacturing had contracted, adding that it was still less than the previous fiscal year.
The minister also stressed the need to “do a deep dive” into the sectors that have declined, which he said included chemicals, iron and steel.
“Autos went up by 40pc, wearable apparel rose by 8pc, textiles went up by 2pc, petroleum products increased by 4.5pc,” the minister said, referring to the gains witnessed by each of these sectors during FY25.
“The devil is always in the details. I will mention why I’m very confident in saying that this fiscal year will be a turnaround story,” he underscored.
The services sector grew by 2.9pc against 2.2pc the previous fiscal year, while the information and communications sector expanded by 6.5pc, according to the minister.
“Construction and real estate grew by 3.8pc, food services by 4.1pc,” he said, adding that the transport sector had grown due to higher activity at ports, shipping lines and airlines.
Inflation, he said, had been a fantastic story for Pakistan: 6.8pc global inflation in 2023, 5.7pc in 2024 and the estimate for 2025 is 4.3pc in terms of CPI inflation.
Aurangzeb noted that the Consumer Price Index (CPI) had crossed 29pc in 2023 but now had plunged to just 4.6pc. “So, I think we’ve moved in the right direction in terms of the global figures.”
According to the survey, GDP per capita reached $1,824, up from $1,662 in the previous year, showing a 9.7 per cent increase that was supported by improved economic activity and a stable exchange rate.
Addressing the country’s monetary policy, the finance minister recalled that the interest rate was at a record 22pc in 2023, following which “steps were taken” to reduce it, and now the key policy rate stood at 1,100 basis points, he said.
Talking about macroeconomic indicators, Aurangzeb said, “Public debt and debt-to-GDP ratio was 68pc, which is now 65pc.
