However, growth for FY25 is lower than the long-term average
of 4.7% and last five-year growth of 3.4%. This FY25 growth of 2.68% is
broadly in line with revised projections of the IMF and World Bank, reported at
2.6% and 2.8%, respectively, published in April 2025. However, it is less than
government’s initial target of 3.6% growth for FY25.
According to Topline Securities, this number will be revised
down especially due to enlarged growth numbers of industrial segment at 4.77%
compared to actual growth in 9MFY25 at negative 1%.
Services sector growth has posted provisional growth of
2.91% in FY25 as compared to 2.19% change in FY24. Within services, Public
Administration and Social Security (General Government) saw highest growth of
9.92% while wholesale and retail trade saw a meagre 0.14% rise. The brokerage
house believes, towards end of the year, services numbers for FY25 will be
revised up as 9MFY25 growth average is already 2.97%.
Industrial segment recorded provisional growth of 4.77%,
highest in 4 years, contrary to contraction of 1% in 9MFY25, Industrial sector
has posted provisional growth of 4.77% in FY25, highest in 4 years. Within
this, electricity gas & water supply, construction, and manufacturing
sector are likely to grow by 28.88%, 6.61%, and 1.34%. While mining &
quarrying and Large-Scale Manufacturing (LSM) are expected to post decline of
3.38% and 1.53%, respectively.
Agriculture growth at 9 years low, as agri sector is
expected to post lowest growth of 0.56% in 9 years as against 5 years average
growth of 3.38%. Lower growth is attributed to decline in important crops
production and cotton ginning by 13.5% and 19.0%, respectively. While other
crops posted growth of 4.78%. Livestock, Forestry and fishing will post growths
of 4.72%, 3.03% and 1.2% respectively. On the other hand, important crops and
cotton will post declines of 13.49% and 19.03%, respectively.
Other takeaways from press briefing of Finance Minister and
economic survey document
Finance Minister mentioned that Government has undertaken
various structural reforms which were warranted to sustainable economic growth
and will continue to do so in upcoming fiscal years.
Recoveries in DISCOs have improved due to change in their
Governance Structure. GoP has constituted professional board structure in these
DISCOs.
Mobilization of PKR1.25 trillion through banks will play
important role in clearing this legacy circular debt.
GoP has saved PKR0.8 trillion to PKR1 trillion in interest
expense in FY25 due to decline in interest rates.
GoP has already implemented defined contribution pension
plan starting Jul 01, 2024, for all new recruits to address pension issues.
Rightsizing of federal Government is also under process and
being implemented with true spirit
Pakistan posted GDP growth of 2.68% in FY25, a bit lower
than target growth due to underperformance in agriculture segment. Current
Account remained in Surplus in 10MFY25, and the full year is expected to close
in surplus. Full year remittances are expected to be around US$38 billion.
Freelancers have earned over US$400 million out of total IT Exports of US$3.1 billioon.
During FY25, Important crops declined by 13.49% amidst lower
cultivation area and adverse weather conditions, significantly affecting cotton
(down 30.7%), wheat (down 8.9%), sugarcane (down 3.9%), maize (down 15.4%), and
rice (down 1.4%).
Globally economic growth is expected at 2.8% in 2025, lower
from 3.3% achieved in 2024.
Average time to maturity of the domestic debt has increased
from 2.9 years to 3.5 years. To highlight, this is also one of the indicative
targets of the IMF.
The year 2024 was recorded as Pakistan’s ninth warmest year
in the last 64 years, with an average temperature of 23.52°C and rainfall
levels 31% above the historical average.
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