ISLAMABAD: Pakistan’s economy showed steady improvement in the second quarter of fiscal year 2025-26, expanding by 3.89% during October to December, according to data released by the National Accounts Committee (NAC).
This marks a clear rise compared to 2.18% growth recorded in the same period last year, and also shows a slight improvement over the revised 3.63% growth in the first quarter (July–September).
The overall growth was mainly supported by a strong performance in the industrial sector, which expanded by 7.40% year-on-year. Meanwhile, the agriculture sector grew modestly by 1.76%, and the services sector recorded a 3.69% increase, helping maintain the upward trend.
Despite the positive outlook, some sectors faced challenges. Agriculture growth remained limited due to a decline in major crops, which fell by 1.87%. Cotton production dropped slightly, while rising costs of seeds and fertilisers also impacted output. However, livestock performed better, growing by 5.59%, supported by relatively lower input costs.
In the industrial sector, growth was driven by improvements in large-scale manufacturing. Industries such as automobiles, transport equipment, and petroleum products showed strong gains. The construction sector also performed well, expanding by over 10%, supported by increased cement production.
However, the mining and quarrying sector remained under pressure, shrinking by 2.46% due to reduced production of gas and other minerals.
The services sector also contributed positively, growing by 3.69%. Wholesale and retail trade saw healthy activity, while the transport and storage sector improved slightly, supported by increased movement of goods and passengers.
The NAC also revised some previous growth figures. GDP growth for the first quarter of FY26 was adjusted down to 3.63%, while full-year growth for FY25 now stands at 3.06%. Similarly, FY24 growth was finalised at 2.62%.
Looking ahead, the State Bank of Pakistan expects the economy to grow by around 4% in FY26. The government has set a slightly higher target of 4.2%, while the World Bank projects a more cautious growth rate of around 3%.
The figures were approved during the 115th meeting of the NAC, held at the Pakistan Bureau of Statistics, where updated economic estimates and sectoral performance were reviewed.
