Economic Survey 2025–26 set for Thursday as Inflation clouds modest Economic Gains

ISLAMABAD – Pakistan’s Economic Survey 2025–26 will be presented on Thursday, offering a mixed picture of the economy ahead of the new budget. While remittances remained strong and the services sector showed some resilience, overall growth fell short of targets. Key sectors like agriculture and industry underperformed, exports stayed weak, and inflation, despite brief stability, spiked again in May, underscoring persistent economic pressures. The economy of South Asian nation is set to miss several major targets in FY2025–26, with slowing growth, weak exports, and a fresh spike in inflation exposing the challenges facing the government ahead of the new federal budget. Economic Survey of Pakistan 2025–26, scheduled to be released on Thursday, paints mixed picture of the economy: record remittances and a resilient services sector on one side, but disappointing growth in agriculture, industry, and exports on the other. The economy will grow by 3.7 percent this fiscal year, well below the government’s 4.2 percent target. The shortfall comes despite repeated assurances of economic recovery and follows earlier warnings from the IMF, World Bank, and Asian Development Bank that Pakistan was unlikely to achieve its growth goal. Inflation remained near official target of 7 percent during the first eleven months of FY2025–26, May delivered major shock as inflation jumped to 11.66 percent, raising fears that price pressures are once again building across the economy. Per capita income also failed to hit the government’s target. Officials had aimed for Rs. 560,803, but estimates now place it at Rs. 533,629. In dollar terms, however, income rose by $150 to reach $1,901, largely due to currency stability during the year. The agriculture sector, often considered the backbone of Pakistan’s economy, posted growth of only 2.89 percent against the official target of 4.5 percent, highlighting continued problems in crop production and rural productivity. Industrial growth also remained s