Pakistan GDP growth recovered to 3.7 percent in FY26, Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb said on Friday, as he outlined the government’s progress in restoring macroeconomic stability and its priorities for steering the economy toward investment, capital formation, exports and private sector-led expansion.
The minister was addressing a session titled “Fireside Chat: Pakistan: External Shocks Remain Manageable” at the J.P. Morgan Emerging and Frontier Markets Opportunities Conference in London. The conference drew strong interest in Pakistan from leading global institutional investors and top money managers, with 55 global investment funds engaging with the Pakistani delegation through one-on-one meetings and a full investor session.
Presenting the government’s economic scorecard, Aurangzeb said GDP growth had recovered to 3.7 percent in FY26, while the fiscal deficit had declined to 2.6 percent of GDP, a multi-year low. The country also recorded a primary surplus for the third consecutive year, he added, describing the gains as significant progress in fiscal consolidation, external sector stability, inflation, debt management and international market access.
The finance minister said that over the past three years, Pakistan’s overriding task had been to restore macroeconomic stability and rebuild credibility. With that foundation now in place, he said the objective was to ensure stability became durable and provided the basis for a different growth model, one increasingly driven by investment, productivity, exports and private sector activity rather than short-term, consumption-led expansion. The Pakistan GDP growth figure he cited was presented as evidence that the recovery is taking hold.
Aurangzeb laid out six priorities: strengthening macroeconomic stability; promoting sustainable, productivity- and export-led growth; continuing structural reforms; shifting from aid to trade and investment; expanding access to finance; and preparing Pakistan for the digital economy, including blockchain and Web 3.0.
Highlighting improvements in Pakistan’s sovereign debt position, the minister said the government had pursued active liability management, extended domestic debt maturities and reduced refinancing risks. Together with fiscal consolidation, he said, these measures were strengthening the overall sovereign balance sheet and supporting greater confidence in Pakistan’s economic outlook.
He also said Pakistan had re-established access to international capital markets through diversified instruments and investor pools, referring to the inaugural award-winning Panda Bond issuance and the country’s subsequent record US$3 billion dual-tranche Eurobond transaction. Both drew strong investor demand, he noted.
On privatisation, Aurangzeb said the process was being pursued as part of a broader restructuring of the role of the State, with progress across Pakistan International Airlines, the power distribution companies, financial institutions, other state-owned enterprises and airport operations. He added that access to finance was being expanded across small and medium enterprises, agriculture and housing so that macroeconomic stability could translate into greater credit, investment and productive activity, stressing that public balance sheets alone could not finance Pakistan’s next phase of growth and that private capital would increasingly have to play a larger role.
On external engagement, the finance minister said Pakistan was moving decisively from traditional dependence on aid towards stronger trade and investment flows.
Also addressing the occasion, State Bank of Pakistan Governor Jameel Ahmad highlighted the strengthening of the country’s external position, noting the improvement in foreign exchange reserves, the quality of reserve accumulation, rising remittance flows and strengthening external-sector fundamentals. He pointed to the growing contribution of Roshan Digital Account flows, external sector reforms and the strengthening of financial sector fundamentals. The governor noted progress made in containing inflation over the years, adding that these developments had contributed to greater macroeconomic stability and strengthened the foundations for sustainable growth and investment.
Source: ARY News