Pakistan’s GDP growth seen at 3.8% in FY27, inflation to hit 8.2%

The World Bank projects Pakistan’s economy will expand by 3.8% in FY27, while annual inflation rises to 8.2% from 7.1% in FY26. Mettis Global reported that conflict in the Middle East and persistent pressure from global commodities and local food prices shape the outlook; energy and commodity costs are not expected to return to earlier levels until the latter half of FY27.

Agriculture faces weather risks linked to El Niño and more expensive fertilizer, although livestock is expected to lead the sector and crop output to recover gradually; manufacturing and construction should support a slight industrial improvement, helped by budget tax cuts for property. The World Bank also sees FY27’s current account gap below 1% of GDP, with remittances covering most of the trade deficit, and forecasts growth reaching about 4.5% by FY31 as prices and input costs ease. Its baseline assumes no major new reforms and more restrained fiscal easing before the 2029 election.