Islamabad : Pakistan’s economy is set to experience steady growth in the current year, with real GDP expected to rise by 3.4 per cent, underpinned by a robust recovery in industrial activity and sustained momentum in the services sector, China Economic Net (CEN) reported on Friday quoting according KTrade Securities’ latest research.
“The outlook builds on the stabilization achieved in 2025. Inflation, which had been a persistent concern, moderated significantly to 5.6% on a year-on-year basis by December 2025.
Real GDP growth also improved to 3.09% in FY2025, and monetary conditions saw a substantial easing, with the policy rate being slashed from 21% to 10.5%,” Muhammad Faran Khan, Associate Director, KTrade Securities said.
Commenting on the chronic challenge of reliance on external financing, Faran noted a weaker US dollar may offer some relief by reducing the cost of debt servicing.
“A softer dollar cuts debt servicing costs in terms of PKR and makes Pakistan’s Eurobonds cheaper to service, which could pave the way for an early buyback.
On the external front, the weaker dollar helps reduce the cost of imports, especially energy imports like oil, benefiting the current account balance and mitigating inflation.
Additionally, sectors such as pharmaceuticals, automobiles, and cement will see margin expansions due to lower import costs,” he explains, the report added.
For global investors, several key sectors are emerging as particularly attractive. Moody’s recently revised Pakistan’s banking sector outlook to stable, reflecting a gradual recovery in the economy and an improving fiscal and external position.
The IT sector has also shown remarkable growth, with exports reaching $2.2 billion in the first half of 2026.
