Pakistan Economic Insights: First Quarter of Fiscal Year 2027 (July – September 2026)

Pakistan’s economy entered FY2026-27 with mixed developments, as improved international credit ratings, encouraging agricultural prospects, and growth in exports and remittances were offset by rising inflation, slowing industrial activity, and external financing pressures. While exports and remittances recorded gains, faster import growth widened the trade imbalance and added pressure on the current account. Pakistan’s FTAs, PTAs, and unilateral trade preferences contributed little to export growth despite improved market access and lower input costs. The report identifies trade imbalances, asymmetric concessions, and weak domestic productive capacity as key constraints and recommends commercially driven renegotiations, stronger export competitiveness, diversification, and broader services liberalization.