Growth to remain moderate at 4.2%

The World Bank expects Pakistan’s economy to expand by 3.8% in the current fiscal year, then 4.2% in FY2027-28 and 4.4% in the 2029 election year, according to The Express Tribune. The lender said growth around these levels would not generate enough work for the 3.6 million people entering the labour market annually, while poverty rose from 22% in 2019 to 29% in 2025.

The report called for a medium-term fiscal plan to protect stability as the IMF programme is due to end in September 2027. It also favoured a more flexible, market-led exchange rate, arguing that intervention and a stable rupee-dollar rate had coincided with a 10% rise in the real effective exchange rate between end-June 2025 and July 2026. Higher energy costs and a prolonged Middle East conflict were identified as risks to growth, imports, exports and the current account.