Pakistan's economic growth rate predicted to be lowest in South Asia

ISLAMABAD: Pakistan’s GDP growth rate is expected to be 2.8 percent in 2025, showing a 0.5 percent improvement compared to June 2024, according to the World Bank’s Global Economic Prospects Report 2025.

The prediction is lower than the International Monetary Fund’s (IMF) forecast of 3percent and the government’s estimate of 3.6percent. The report suggests that Pakistan’s economic growth will remain sluggish due to various internal and external factors.

In contrast to Pakistan economy, other South Asian countries are expected to perform better. India’s growth rate is predicted to be 6.7percent, Bhutan at 7.2 percent, and Maldives at 4.7 percent. Nepal, Bangladesh, and Sri Lanka are expected to have higher growth rates than Pakistan, with rates of 5.1 percent, 4.1 percent, and 3.5 percent.

The World Bank predicts that Pakistan’s growth rate will improve to 3.2 percent in the next fiscal year, but it will still be the lowest in the region.

Read More: Pakistan’s economy is improving, inflation to further drop, says SBP chief

Earlier, State Bank of Pakistan (SBP) Governor Jameel Ahmad announced that Pakistan’s economic growth will surpass 3% in the current fiscal year.

Speaking at a press conference on January 9, the SBP governor stressed the importance of maintaining stable and gradual growth to avoid future balance of payments issues.

Jameel Ahmad also revealed the SBP’s inflation target for the current fiscal year, set at 5 to 7 per cent. He expressed optimism that if economic indicators improve and inflation remains under control, other sectors would also benefit.

“We hope that Pakistan’s current account will remain in surplus through December,” he added.

The SBP governor also provided an update on Pakistan’s foreign debt, which remains at a manageable level. As of now, the country’s actual foreign debt stands at $100.8 billion.

Earlier ion Friday, the State Bank of Pakistan (SBP) reported that Pakistan’s current account surplus reached US$1.21 billion from July to December in the current fiscal year (2024-25)

According to the central bank, this marked a substantial improvement compared to the same period in the previous fiscal year, which saw a deficit of US$1.039 billion.

Pakistan’s current account surplus has been steadily improving, with a surplus of US$582 million in December 2024 and US$684 million in November 2024.