Economy enters sustained stability phase: minister
While addressing a press conference on Tuesday on the launch of the Monthly Development Update – August 2025, he said that Pakistan's economy has entered a phase of sustained stability, with all major macroeconomic indicators showing positive trends during 2025.
He said that remittances also increased by 7.4 percent in July, reaching $3.2 billion, indicating strong confidence of overseas Pakistanis in the government's economic management.
Govt committed to turning Pakistan into a $1trn economy by 2035: minister
He highlighted that GDP growth is on an upward trajectory, inflationary pressures have eased significantly, and both external and fiscal sectors have stabilised. 'In July alone, exports grew by 17 percent, reaching $2.7 billion compared to $2.3 billion in the same month last year. This reflects our priority to ensure continuous growth in exports as a driver of economic progress,' he stated.
'On the fiscal front, the deficit declined to 5.4 percent of GDP, the lowest in eight years, while the primary balance posted a surplus of 2.4 percent of GDP—its highest level in 24 years. Improved fiscal discipline has enabled the government to spend over Rs1,068 billion on development projects in Financial Year 2025, achieving a historic 98 percent utilisation rate,' Iqbal said.
The minister said that inflation has fallen sharply, with the Consumer Price Index (CPI) rate dropping to 4.1 percent in July 2025 from 11.1 percent in July 2024, and the annual inflation rate down from 38 percent to just four percent. 'This downward trend in inflation is expected to continue, providing relief to the people,' he assured.
He said that the Pakistan Stock Exchange crossed the 141,000 mark on August 1, driven by a new trade agreement with the United States, which secured the lowest tariff rates in South Asia. 'It is now up to our business community to take full advantage of this opportunity,' he added.
Highlighting advancements in the agriculture sector, he announced that for the first time, comprehensive national agricultural data has been collected through the 7th Agriculture Census 2024, which will support evidence-based policy-making for food security, climate resilience, and rural development.
He said that in July 2025, the Central Development Working Party (CDWP) approved eight major projects and recommended three to the Executive Committee of the National Economic Council (ECNEC), expected to create over 2,000 jobs. Cost rationalisation measures saved Rs40 billion in development projects, reflecting a strategic and efficient approach to public sector planning.
He said that on the technological front, Pakistan successfully launched its Remote Sensing Satellite from China on July 31, 2025, which will aid in agriculture monitoring, urban planning, disaster management, and climate change analysis. He announced that in 2026, Pakistan's first astronaut will conduct scientific experiments in collaboration with China.
The minister also shared that under the Prime Minister's Baikhtiyar Nawjawan Program, the URAAN Overseas Summer Internship Scholar Program received over 2,300 applications from 45 countries, with 31 top-performing students selected and placed in key divisions of the Planning Commission.
Iqbal reiterated the government's commitment to accelerating export-led, technology-driven projects under the PSDP 2025–26, with a focus on youth and women empowerment, climate resilience, and inclusive development. He directed the Ministry of Finance to increase first-quarter PSDP releases by five percent and reduce last-quarter releases from 40 percent to 30 percent to ensure steady project execution throughout the year.
He pointed out that global confidence in Pakistan's economy has strengthened, with international financial institutions and rating agencies acknowledging the turnaround. Barron's described Pakistan's recovery as a 'macroeconomic miracle,' while Fitch, Moody's, and S&P upgraded the country's ratings and outlook, he said.
'Pakistan's macroeconomic stability, coupled with structural reforms and strong international partnerships, is driving private sector growth and innovation. The government is determined to sustain this momentum to secure a prosperous and resilient future for the nation,' he concluded.
According to report of 'Monthly Development Update – August 2025', in July FY2026, 'the PSDP spending recorded unprecedented achievement of Rs1,068 billion with 98 per cent utilisation of the Rs1,096 billion authorised allocations, reflecting improved execution and fiscal discipline. The PSDP 2025-26 is pitched at 1,000 billion including foreign loan rupee cover of Rs229 billion. Highest PSDP 2025-26 allocations (63 per cent) are directed towards infrastructure sector.'
Copyright Business Recorder, 2025
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