Pakistan’s economy expanded at a 3.89% pace in the second quarter (October–December) of the fiscal year 2025‑26, driven mainly by a rebound in industrial activity and steady services performance, official data shows. The growth figure was approved by the National Accounts Committee (NAC) after reviewing provisional estimates from the Pakistan Bureau of Statistics (PBS).
Industry Leads, Agriculture Lags Behind
Industry was the strongest contributor to growth, expanding 7.4% in Q2, supported by large‑scale manufacturing, electricity, gas and water supply, and construction activity. This marked a significant uptick in industrial output compared to the same period last year. Services grew by 3.69%, buoyed by trade, finance, and public services, while agriculture posted a more modest 1.8% increase, reflecting mixed crop performance.
However, the NAC meeting highlighted a gap in actual crop output data, especially for wheat, raising questions about the accuracy of agricultural estimates. PBS officials explained that harvesting has not yet begun in many regions, making precise production figures unavailable.
First Quarter Updated; Growth Outlook Maintained
The committee also revised the first quarter (Q1) growth rate downward to 3.63%, slightly lower than earlier estimates, due to adjustments in agriculture and industry figures. Combined, first‑half GDP expansion now stands around 3.76%, broadly in line with government expectations for the year.
For the full fiscal year, authorities reaffirmed their growth target of 4.2%, with expectations that momentum in manufacturing, construction, and export‑oriented sectors could help achieve this despite external pressures.
Jobless Growth and Structural Concerns
Even as growth figures improve, critics warn that the economy’s performance remains shallow in terms of job creation and poverty reduction. Recent surveys show poverty and unemployment rates rising, suggesting that headline GDP gains are not translating into broad‑based economic improvement.
What This Means
The Q2 figures offer a mixed picture: industrial recovery and services stability are positives, but agriculture’s slow pace and missing crop data temper the optimism. The broader challenge remains turning these growth numbers into meaningful jobs and living‑standard improvements for Pakistan’s growing labour force.
