Pakistan economic policy and trade development

Pakistan is transitioning its economic strategy from macroeconomic stabilization toward investment, capital formation, and export-led growth. Finance Minister Muhammad Aurangzeb reported that GDP growth reached 3.7 percent in FY26 and the fiscal deficit fell to 2.6 percent of GDP. He also noted that foreign exchange reserves reached a historic high of $21.4 billion.

To support this growth, the government is prioritizing sustainable productivity and the expansion of the digital economy. The stability of Karachi is identified as a critical factor, as the city contributes over 60 percent of national revenue. Security efforts by the Pakistan Rangers and police have focused on reducing extortion and targeted killings to bolster business confidence.

On the international stage, Pakistan’s export value rose to US$32.5 billion in 2024, a 12.1 percent increase from the previous year. The United States remains the country’s largest trading partner, accounting for US$5.6 billion in exports, followed by China, the United Kingdom, the United Arab Emirates, and Germany.