Agriculture Stumbles But Industry, Services Sectors Rebound in FY25

Pakistan’s GDP grew by 2.7 percent in FY2024-25, falling short of the 3.6 percent target, largely due to a 13.5 percent contraction in important crops like cotton (-30.7 percent) and wheat (-8.9 percent) amid erratic weather and input challenges, according to the working paper for the Annual Planning Coordination Committee (APCC). Despite the setback in agriculture, the industrial sector staged a strong comeback with 4.8 percent growth, led by a 28.9 percent surge in electricity, gas, and water supply, and a 6.6 percent rise in construction. However, large-scale manufacturing contracted by 1.5 percent, reflecting sluggish demand in key sectors like chemicals and steel. The services sector posted modest growth of 2.9 percent, up from 2.2 percent last year, buoyed by strong performance in public administration (9.9 percent), ICT (6.5 percent), and finance (3.2 percent). The government now projects 4.2 percent GDP growth in FY2025-26, banking on recovery in agriculture and manufacturing, and steady services sector momentum.