Pakistan’s economy has shown a strong and encouraging start to the fiscal year 2025–26, recording a 3.71 percent growth in GDP during the first quarter, according to data shared by Federal Minister for Planning, Development and Special Initiatives Ahsan Iqbal. The development on Tuesday and has been termed a significant shift in the country’s economic direction.
Taking to social media platform X, Ahsan Iqbal highlighted that the first-quarter growth of FY26 is 2.15 percentage points higher than the growth recorded in the same quarter of the previous fiscal year. He described this improvement as a qualitative change in Pakistan’s economic trajectory, indicating a move towards stability and sustained recovery.
During FY25, Pakistan’s quarterly GDP growth remained uneven. The economy expanded by 1.56 percent in Q1, followed by 2.03 percent in Q2, 2.66 percent in Q3, and a sharper rise of 6.17 percent in Q4. In contrast, FY26 has begun with growth that is more than double compared to the corresponding quarter of last year, reflecting a stronger and more balanced economic momentum.
Ahsan Iqbal noted that the current economic improvement is being driven primarily by the industrial sector. Industrial output expanded by an impressive 9.38 percent in the first quarter of FY26, a sharp turnaround from the meagre 0.12 percent growth recorded during the same period last year. This surge points towards improved manufacturing activity, better capacity utilisation, and the impact of policy measures aimed at reviving industrial production.
The planning minister also acknowledged that the economic rebound has occurred despite several major challenges. These include the flood shock of 2025, fiscal tightening under stabilisation measures, the withdrawal of energy subsidies, and persistent food inflation, all of which had put pressure on economic activity and household incomes.
According to Ahsan Iqbal, the latest GDP figures demonstrate growing resilience in Pakistan’s economy. He said the performance reflects the effectiveness of policy adjustments introduced to stabilise the macroeconomic environment and lay the groundwork for long-term recovery.
Economists believe that sustained industrial growth, combined with improved investment sentiment and structural reforms, could help Pakistan maintain this upward trend in the coming quarters. However, they also stress the need for continued focus on inflation control, export growth, and social protection to ensure that economic gains translate into broader public welfare.
