Pakistan’s Fourth-Quarter GDP Growth Slows to 2%

Pakistan’s economy expanded by 2% during the April-June quarter of fiscal year 2025-26, reflecting a sharp slowdown as industrial activity contracted. The National Accounts Committee approved the fourth-quarter estimate and revised full-year economic growth slightly downward to 3.65%.

The quarterly performance was uneven across the main sectors of the economy. Agriculture grew by 3.7% and services expanded by 3.62%, but a 4.7% contraction in industry held overall growth to considerably below the pace recorded in the previous three quarters.

Within industry, mining and quarrying grew by 8.9%, supported by increased production of natural gas, oil and coal. Large-scale manufacturing recorded growth of only 0.41%, while construction expanded by 3.52% because of higher cement output and increased public-sector infrastructure spending.

The Pakistan Bureau of Statistics attributed part of the slowdown to comparison with a high base, as the economy had grown by about 6.1% during the corresponding quarter of the previous year. It also reported that electricity, gas and water-supply activity contracted by 33.2%, influenced by the earlier high base, reduced energy subsidies and the inflation adjustment used in calculating output.

Agriculture received support from major crops, which grew by 2.2% following updated production benchmarks for wheat, rice and sugarcane. In services, wholesale and retail trade increased by 0.75%, while transport and storage grew by 3.3% as road and railway activity improved.

The committee also approved a major revision of Pakistan’s import data covering fiscal years 2020-21 through 2024-25. The revised series added a cumulative $14.8 billion to previously reported imports after differences emerged between information compiled through Pakistan Revenue Automation Limited and the more comprehensive Pakistan Single Window system.

Imports for fiscal year 2024-25 were revised upward by $6.1 billion to $64.5 billion, while the figure for 2023-24 increased by $5.1 billion to $59.9 billion. Smaller additions were approved for the preceding three fiscal years, affecting national-account calculations linked to trade, services and the overall size of the economy.

The statistical revisions added Rs227 billion to the estimated size of the economy for fiscal year 2023-24 and Rs137 billion for 2024-25. The updated figures placed the economy at Rs105.5 trillion in 2023-24 and Rs114.2 trillion in 2024-25, with a marginally positive effect on calculated per-capita income.

The fourth-quarter results show that Pakistan’s recovery remained uneven despite stronger agricultural and service-sector activity. Future growth will depend on whether industrial production strengthens, energy-related pressures ease and revised trade statistics improve the accuracy of economic planning and policy decisions.