Pakistan Economic Survey 2024–25: wins, warnings and what's next
Pakistan has unveiled its Economic Survey 2024-25, revealing measurable improvement across key indicators, though challenges remain in the agriculture and manufacturing sectors. Here is a look at its key highlights:
Growth and Investment
Agriculture sector
The agriculture sector demonstrated resilience in FY2025, recording growth of 0.56%, primarily driven by livestock performance. The sector's share in GDP declined slightly to 23.54% from 24.03% in FY2024.
Important crops declined by 13.49% due to reduced cultivation area and adverse weather conditions, significantly affecting cotton (-30.7%), wheat (-8.9%), sugarcane (-3.9%), maize (-15.4%), and rice (-1.4%). Cotton production was recorded at 7.08 million bales, sugarcane 84.24 million tonnes, wheat 28.98 million tonnes, and rice at 9.72 million tonnes.
Other crops grew by 4.78%, driven by robust performances in potato (11.5%), onion (15.9%), and mash (4.7%). Cotton ginning lost momentum, declining by 19.03% compared to the growth of 47.23% in the previous year.
The livestock sector, contributing 63.60% to agriculture and 14.97% to Pakistan's GDP, grew by 4.72% in FY2025, up from 4.38% the previous year. The forestry sector recorded growth of 3.03%, maintaining a steady contribution of 2.31% to agriculture and 0.54% to GDP. The fisheries sector grew by 1.42%, improving from 0.81% last year, with a sectoral share of 1.31% in agriculture and 0.31% in GDP.
Growth and investment
Real GDP recorded growth of 2.68% in FY2025, underpinned by broad-based stabilization across key macroeconomic indicators. The industrial sector posted 4.77% growth driven by manufacturing recovery, while the services sector expanded 2.91%, maintaining its position as the largest GDP contributor with a 58.40% share.
GDP at current market prices increased to Rs114,692 billion, reflecting a 9.1% increase from the previous year's Rs105,143 billion. The investment-to-GDP ratio reached 13.8% compared to 13.1% in FY2024, while the saving-to-GDP ratio increased to 14.1% from 12.6% last year.
Fiscal Performance
The fiscal deficit narrowed to 6.5% of GDP from 7.4% last year. Revenue collection grew 29% to Rs10.8 trillion, with tax revenue increasing 38%. Current expenditures rose 26% due to higher interest payments.
Monetary situation
Inflation declined sharply to a record low of 0.3% in April 2025, down from 17.3% in April 2024. The average CPI inflation for July-April was 4.7%, marking a significant decrease from 26.0% in the same period last year. The State Bank cut policy rates by 450 basis points to 17.5% since July 2024. Broad money supply grew 13.7%.
External sector
Per capita income reached $1,824, up from $1,662 in the previous year, showing a 9.7% increase supported by improved economic activity and a stable exchange rate. The current account recorded a $1.2 billion surplus (0.3% of GDP), while remittances grew 11% to $32 billion. Foreign reserves reached $14.3 billion, covering 3.6 months of imports.
Health and education
Pakistan's health sector showed modest improvements in FY2024- 25, with infant mortality declining to 52 per 1,000 live births from 56 last year, though national health expenditures remained at just 1.4% of GDP. The education sector saw literacy rates rise to 62.8%, while primary school enrollment reached 28.6 million children, yet education spending stayed at 2.1% of GDP, below regional benchmarks.
Technology and Infrastructure
The IT sector emerged as a bright spot, with exports surging 32% to $3.5 billion and digital banking transactions growing 89% to Rs12.7 trillion, as mobile broadband penetration reached 57% of the population. Transport infrastructure expanded with road networks growing to 284,772 km and aviation passenger traffic jumping 24%, though rural connectivity gaps persist.
Demographics and Labor
Population growth slowed slightly to 2.4%, with urban residents now comprising 40.1% of Pakistan's 241.5 million people, while labor force participation remained stagnant at 37.2%, with significant gender disparities.
"Our digital transformation is accelerating, but human development needs matching investment," Finance Minister Muhammad Aurangzeb told reporters during the survey's launch.
Debt and Capital Markets
Pakistan's public debt stood at Rs67.8 trillion (74.1% of GDP) by March 2025, marking a 2.3 percentage point decline from last year's 76.4% debt-to-GDP ratio. Domestic debt comprised 61% of the total at Rs41.4 trillion, while external debt accounted for Rs26.4 trillion.
The capital market demonstrated robust growth with market capitalization at the Pakistan Stock Exchange surging 50% to Rs10.2 trillion, while the benchmark KSE-100 index gained 78,000 points during FY2025. Corporate bond issuance increased 38% year-on-year to Rs480 billion.
Manufacturing and Mining
Manufacturing output showed mixed results, with the industrial sector posting 4.77% growth driven by a recovery in manufacturing. Small-scale manufacturing and slaughtering helped offset contractions in large-scale manufacturing (LSM). The auto sector rebounded strongly with 42% production growth, while cement output declined 7.2%.
The mining sector grew 2.1%, with coal production increasing 12% to 10.4 million tonnes. However, mineral exports fell 9% to $682 million due to global price fluctuations. Chromite production dropped 18% while rock salt output grew 5%.
The mixed results come ahead of Tuesday's budget announcement, with observers watching for increased allocations to health and education.
The survey noted particular challenges in maternal healthcare and secondary school enrollment, where rates continue to lag behind regional peers despite incremental improvements.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
8 hours ago
- Business Recorder
US inflation edges up as Trump tariffs flow through economy
WASHINGTON: US consumer inflation ticked up in May, in line with analyst expectations, government data showed Wednesday as President Donald Trump's sweeping tariffs began to ripple through the world's biggest economy. The consumer price index (CPI) came in at 2.4 percent from a year ago after a 2.3 percent reading in April, the Labor Department said, with headline figures cooled by energy prices. All eyes were on US inflation data after Trump imposed a blanket 10 percent levy on imports from almost all trading partners in early April. He also unveiled higher rates on dozens of economies including India and the European Union, although these have been suspended until early July. Trump engaged in a tit-for-tat tariff escalation with China as well, with both sides temporarily lowering high levies on each other's products in May. Despite the wide-ranging duties, analysts said it will take months to gauge the impact on consumer inflation. This is partly because businesses rushed to stockpile goods before Trump's new tariffs kicked in – and they are now still working their way through existing inventory. US tariffs may hamper efforts to cool inflation: Fed official 'As that inventory level gets worked down, we'll see a larger and larger pass-through of the tariffs,' Nationwide chief economist Kathy Bostjancic told AFP. Between April and May, CPI was up 0.1 percent, cooling from a 0.2 percent increase from March to April. While housing prices climbed alongside food costs, energy prices edged down over the month, the report added. The energy index fell 1.0 percent in May from a month ago, as the gasoline index declined over the month. Excluding the volatile food and energy components, so-called core CPI was up 2.8 percent from a year ago, the Labor Department said. 'Early signs' 'Many Americans are enjoying cheaper gas prices this summer,' said Navy Federal Credit Union chief economist Heather Long. 'But there are early signs of what is coming for Main Street: grocery store prices and appliance costs rose in May,' she added in a note. Samuel Tombs, chief US economist at Pantheon Macroeconomics, estimates that retailers usually take at least three months to pass on cost increases to customers. He expects price increases for 'core goods' to gain momentum in June and peak in July, while remaining elevated for the rest of the year – assuming current tariff policies remain in place. But Bostjancic said she did not expect the latest inflation report to significantly impact the US central bank's interest rate decision next week. 'The guidance remains that there's such a great degree of uncertainty of how the increased tariffs will affect prices and ultimately the economy,' she said. 'They need to wait and see, to see how this plays out over the coming months. And we should learn a lot more from the data through the summer and early fall,' she added. The Federal Reserve has begun cutting interest rates after the Covid-19 pandemic as officials monitor progress in lowering inflation sustainably. But Fed policymakers have been cautious in recent months as they monitor how the Trump administration's policies affect the economy.
Business Recorder
17 hours ago
- Business Recorder
Gold rises as US-China trade uncertainty persists, investors eye inflation data
Gold prices edged higher on Wednesday as uncertainty surrounding the finalisation of a US-China trade agreement weighed on sentiment and fuelled some safe-haven buying, with investors awaiting key US inflation data for further market direction. Spot gold rose 0.2% to $3,328.89 an ounce, as of 0153 GMT. US gold futures were up 0.2% to $3,349.80. US and Chinese officials agreed on a framework to put their trade truce back on track and resolve China's export restrictions on rare earth minerals and magnets, US Commerce Secretary Howard Lutnick said on Tuesday at the conclusion of two days of intense negotiations in London. Lutnick said that the US team plans to present the framework to President Donald Trump for approval prior to implementation, while the Chinese delegation will similarly seek an endorsement from President Xi Jinping. 'We know that US and Chinese negotiators have agreed on a 'framework', but until Trump or Xi approves them, uncertainty lingers. And that uncertainty is supporting gold heading into the inflation figures,' said Matt Simpson, a senior analyst at City Index. The US and China had imposed tit-for-tat tariffs in April, sparking a trade war. Following talks in Geneva last month, both nations agreed to cut tariffs back from triple-digit levels. The World Bank on Tuesday slashed its global growth forecast for 2025 by four-tenths of a percentage point to 2.3%, saying that higher tariffs and heightened uncertainty posed a 'significant headwind' for nearly all economies. Gold prices tumble The US consumer price index (CPI) report due at 1230 GMT could give investors more guidance on the US Federal Reserve's policy path. The Federal Reserve will keep interest rates on hold for at least another couple of months, according to most economists polled by Reuters, as risks linger that inflation may resurge due to Trump's tariff policies. Elsewhere, spot silver was unchanged at $36.53 per ounce, platinum fell 0.4% to $1,216.42, while palladium was up 0.3% to $1,063.62.
Business Recorder
a day ago
- Business Recorder
Gold inches up as markets await outcome of US-China trade talks, inflation data
LONDON: Gold prices edged higher on Tuesday, while investors awaited more clarity on US-China trade talks and looked forward to key US inflation data due this week for clues on the Federal Reserve's future interest rate decisions. Spot gold was up 0.3% at $3,336.33 an ounce, as of 1224 GMT, after falling to a low of $3,301.54 earlier in the session. US gold futures were up 0.1% at $3,357.20. 'Gold found some floor amid dip-buying, though the uptick lacked bullish conviction. Fiscal concerns and Fed rate cut bets are the catalyst for a recovery in the prices,' said Jigar Trivedi, senior commodity analyst at Reliance Securities. Top officials from the world's two largest economies sought to defuse a bitter dispute that has widened from tariffs to restrictions over rare earths, with trade talks extending to a second day in London. The US and China imposed reciprocal tariffs in April, which ignited trade war concerns. But last month, both countries agreed to a temporary pause in tariffs against each other, offering some relief to financial markets. Investors now await the Consumer Price Index data on Wednesday to analyse the Fed's policy path. The CPI report will be one of the last key pieces of data before the Fed's June 17-18 meeting, where it is widely expected to hold rates. Spot silver was steady at $36.72 per ounce, hovering near a more than 13-year high. Platinum eased 0.1% to $1,218.85, after hitting its highest level since May 2021. Palladium lost 1.4% to $1,059.02. 'Overall, the lack of excitement for recent macro data has allowed silver and platinum to steel the limelight, both trading sharply higher in recent sessions before some emerging signs of profit-taking in today's session so far,' said Ole Hansen, head of commodity strategy at Saxo Bank.
