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The IMF’s latest World Economic Outlook has highlighted a clear gap between Pakistan’s official growth target and the projections of major global lenders, raising questions about the realism of the government’s FY26 economic ambitions.
According to the IMF, Pakistan’s economy is expected to grow by 3.2 percent in the current fiscal year, significantly lower than the government’s 4.2 percent growth target for FY26. This difference of one full percentage point underscores concerns about overly optimistic official projections.
The IMF has also revised its outlook downward by 0.4 percentage points compared to its October 2025 estimates, reflecting ongoing structural challenges, weak investment activity, and tight fiscal conditions. However, the lender expects some recovery, projecting growth to rise to 4.1 percent in FY27.
The World Bank’s estimates are more conservative than the IMF’s. It projects Pakistan’s GDP growth at 3 percent for the current fiscal year and 3.4 percent in FY27, suggesting that external institutions remain cautious despite recent economic stabilization measures.
Official data from Pakistan’s Ministry of Finance shows that GDP grew by 3.7 percent in the first quarter of the ongoing fiscal year. While this figure is higher than IMF and World Bank annual projections, analysts note that sustaining this pace throughout the year will be challenging amid high interest rates, fiscal consolidation, and subdued industrial output.
The divergence between Pakistan’s targets and international forecasts matters because IMF and World Bank projections influence investor confidence, credit ratings, and future lending programs. As Pakistan remains under close IMF monitoring, meeting or missing these benchmarks could shape economic policy decisions in the coming months.
