Finance Minister Muhammad Aurangzeb on Monday unveiled the Pakistan Economic Survey 2024-25, saying that measures taken by the government throughout the year had led to a “gradual recovery.”
The survey is a pre-budget document that contains details of major socio-economic achievements during the outgoing fiscal year. It serves as a vital document ahead of the annual federal budget which will be presented tomorrow (Tuesday), offering detailed insights into the country’s socio-economic performance over the outgoing fiscal year.
Speaking during a press conference in Islamabad, the finance minister talked about the global economic outlook, noting that global GDP growth was estimated to decline to 2.8pc in 2025 from 3.5pc two years ago.
“Our recovery needs to be looked at in a global context,” he said.Aurangzeb noted that the Consumer Price Index (CPI) had crossed 29pc in 2023 but now had plunged to just 4.6pc. “So, I think we’ve moved in the right direction in terms of the global figures.”
Addressing the country’s monetary policy, the finance minister recalled that the interest rate was at a record 22pc in 2023, following which “steps were taken” to reduce it, and now the key policy rate stood at 1,100 basis points, he said.
Talking about macroeconomic indicators, Aurangzeb said, “Public debt and debt-to-GDP ratio was 68pc, which is now 65pc.
“Forex reserves as of June 30, 2024, were $9.4bn, which was a huge and remarkable recovery from where we were back in 2023, where we were down to two weeks of import cover. The recovery after [June] 30 continued and we consolidated it in 2024-25.”
Talking about the International Monetary Fund (IMF) loan, Aurangzeb asserted, “Our credibility and trust was re-established under Prime Minister Shehbaz Sharif’s leadership.”
Noting that the premier had signed the Stand-by Arrangement (SBA) before the caretaker administration took over, the minister also praised the efforts of caretaker finance minister Dr Shamshad Mirza as her “discipline allowed us to continue”.
Aurangzeb then highlighted two reasons for Pakistan desiring an Extended Fund Facility with the IMF, with the first one aiming to “bring permanence to macroeconomic stability” and remove fragility.
The second reason, he added, was to continue with structural reforms. “We needed to fundamentally change the economy’s DNA, and for that, we needed structural reforms which are elusive in this country. We needed to proceed with a structured programme,” he said.
On the topic of revenue, Aurangzeb said, “Our tax-to-GDP has hit a five-year high and the prime minister is leading this personally. This whole transformation is around people, processes, and technology.
“Tech played a big role — digital invoicing, production tracking, AI audits, faceless customs regime,” he added, terming the progress in FY2024-25 great.
“Any transformation takes two to three years, and I think we have done a good job in terms of where we wanted to take things,” the minister said, adding that recoveries in the power sector had been “remarkable”.
Aurangzeb then highlighted that industrial and household energy tariffs had been slashed, while private sector and professional boards were introduced for power distribution companies.
“Distribution losses will be reduced going forward,” he added, noting that the National Transmission and Despatch Company (NTDC) distributing to three companies was an important step toward reducing the bottleneck in transmission.
The finance minister said that resolving the Rs1.275tr circular debt would “play an important role”.
“SOEs (state-owned enterprises) have been talked about at length, and Rs800bn has been spent, if you add up equities and guarantees, this goes into the trillions. Those trillions are better spent elsewhere,” he underscored.
Speaking about the government’s decision to privatise 24 SOEs, Aurangzeb affirmed that it would be “completed with renewed vigour and energy next year under adviser to the PM, Mohammad Ali”.
“Debt servicing is the single-largest expense for the federation. In the past year, the policy rate fell and saved us Rs800bn in debt servicing costs,” the finance minister said, adding that he would address it in detail tomorrow.
On pension reforms, the minister stated that contributions must be defined for new government colleagues joining from July 2024.
“Our biggest step is to stop bleeding and then solve legacy issues. But if we don’t stop leakages, it will become very difficult for us to start tackling legacy issues,” he emphasised.
Shedding light on the ongoing rightsizing efforts by the government, Aurangzeb said that “forty-three ministries and 400 attached departments” were to face reduction.
“It’s not [about] the what and why the federal government has to be rightsized. The question is how,” he said, adding that they will “continue with five ministries at a time”.
The finance minister then invited ministries and the heads of their attached departments to give their input on the matter, including “why a department is so critical to the running of the government”.
Speaking about Pakistan’s current account deficit, Aurangzeb observed there was a surplus of $1.9bn from July 2024 to April 2025 compared to a $1.3bn deficit last year.“This entire year will be completed on a surplus,” he stated.
The minister termed the 7pc increase in exports, especially in the IT sector as a “big jump”, adding that money earned by freelancers was close to $400m.
He also noted that imports had increased by 12pc, with non-oil imports almost at the same level as back in 2022, which he said was “a time before the country’s economic crisis.”
While the minister said machinery and transport imports had risen by 16.5pc and 24pc, respectively, he asserted that these would help the agricultural sector, where cotton was being imported.
“Remittances, like inflation, have been an outstanding story,” Aurangzeb remarked. “You can see a 31pc increase year-on-year from $31bn and a record $4.1bn in March. When we close June, we expect our overall remittances to be $37-38bn,” he added, noting that the figure was $10bn less two years ago.“It is very critical that we mention the momentum of the Roshan Digital Account (RDA) because that is investment and lifestyle-led,” the finance head noted.
The minister called RDAs a “different segment of our diaspora”, with inflows from it crossing $10bn and 814,000 accounts opening.
“When we talk about remittances, sometimes we forget about RDA, which is playing a very important role in terms of how we take our diaspora and their commitment to Pakistan,” he stressed.
The minister noted there was a 26pc increase in terms of revenue collection, “on the back of 30pc growth in revenue last fiscal year”.
“There has been a deepening and expanding of the tax base,” Aurangzeb stated.
“Individual filers doubled to 3.7m filers. High-value filers also increased by 178pc,” he said, recalling there were 74pc additional retail registrations in the last fiscal year.
Speaking about debt management, Aurangzeb pointed out that the government had “brought back Rs1tr in local debt due to two reasons”.
“We reduced the prices and money going into markups,” he highlighted, adding that the second reason was to give a signal to the banking system that the government was “not a desperate borrower anymore”.
“We will borrow, but at our terms. It is about time you start lending to the private sector. This was an important message for the banks and they can see the increase,” the minister said.
Aurangzeb further highlighted the banking sector’s shift to Islamic banking. “Average time to maturity has been increased by 66pc so that the refinancing risk is reduced as much as it can be and to prevent bunching around maturities. We want to keep this at 65pc,” he said.
“If the policy rate is falling along with the debt servicing rate, we need to create an alpha. We need liability management trades and strengthening the debt management offices for this purpose.”
“My focus for this fiscal year is restructuring our debt management office around global standards,” Aurangzeb added.
The minister further remarked that the money saved in debt servicing could be diverted to the social or development sectors.
Industrial growth for FY2024-25 was 4.8pc, compared to -1.4pc the previous year, the finance chief said.“In addition to electricity, gas and water, construction went up by 6.6pc,” he stated.
Aurangzeb observed that while small-scale manufacturing had grown by 1.3pc, large-scale manufacturing had contracted, adding that it was still less than the previous FY.
The minister also stressed the need to “do a deep dive” into the sectors that have declined, which he said included chemicals, iron and steel.
“Autos went up by 40pc, wearable apparel rose by 8pc, textiles went up by 2pc, petroleum products increased by 4.5pc,” the minister said, referring to the gains witnessed by each of these sectors during FY2024-25.
“The devil is always in the details. I will mention why I’m very confident in saying that this fiscal year will be a turnaround story,” he underscored.
The services sector grew by 2.9pc against 2.2pc the previous fiscal year, while the information and communications sector expanded by 6.5pc, according to the minister.“Construction and real estate grew by 3.8pc, food services by 4.1pc,” he said, adding that the transport sector had grown due to higher activity at ports, shipping lines and airlines.
Speaking about the agricultural sector which grew by 0.6pc, Aurangzeb said it would have been closer to the target rate if it had been the same as the 2.7pc overall growth rate.Meanwhile, the livestock sector surpassed the target growth rate of 3.8pc, recording a 4.7pc boost.
Aurangzeb said: “Poultry did extremely well, [with the growth rate of] 8.1pc. Fisheries and forestries also grew. Fruits and vegetables collectively grew by 4.8pc but our major crops fell below 13.5pc. This includes cotton, maize and wheat.
“That’s what led to the 0.6pc delta on the agricultural side,” he rued.
“Going forward, our discussion will be about how the government has to get out of this [entirely]. The major crops we have exited, like rice and maize … maybe there were supply-demand factors,” he said, noting that there was ample rice export but lower production.
“Volume and prices have fallen at international levels. We need to consider volumes and prices always.”
The finance head called doing away with the Pakistan Agricultural Storage and Services Corporation (Passco) the “right thing.”
“In terms of mechanisation and seed tech, there is a big delta in the import of agricultural machinery such as wheat threshers. This is the right thing to do,” he added.
Aurangzeb also highlighted that the Punjab government had launched an electronic warehouse for seed financing but “storage capacity and private funding” were needed.
“At the federal level, we will make sure we can provide that ecosystem and support to increase storage. Storage is a big issue. If we want to mitigate middlemen, farmers need a facility to store and retrieve their harvest at will. This is the biggest help we can offer to small farmers,” he noted.
Speaking about financing for farmers, Aurangzeb said credit to the agricultural sector went up by 16pc from July 2024 to April 2025.
“This has crossed over Rs2tr in that time period and we aim to increase it further around the entire supply chain.”
Fiscal findings
According to the Annual Plan Coordination Committee (APCC), whose recommendations were endorsed by the National Economic Council (NEC), Pakistan’s Gross Domestic Product (GDP) growth rate for the fiscal year 2024–25 has been recorded at 2.7 per cent while the target for GDP growth in the next fiscal year has been set at 4.2pc.
The NEC also noted that remittances witnessed a strong increase of 30.9pc from July 2024 to April 2025, and for the first time, the current account balance remained in surplus during this period.
The survey also highlights improvements in fiscal indicators, including a reduction in the fiscal deficit to 2.6pc of GDP. The primary balance recorded a surplus of 3pc of GDP, reflecting a more disciplined fiscal approach.
Owing to improved economic fundamentals and proactive monetary policy measures, the policy interest rate was gradually reduced to 11pc. Meanwhile, credit to the private sector grew significantly, with loans amounting to Rs681 billion disbursed between July 2024 and May 2025.
The survey highlights trends, achievements, and challenges across major sectors including agriculture, manufacturing, industry, services, energy, information technology and telecommunications, capital markets, health, education, transport, and communication.
Additionally, it sheds light on developments in social protection programmes, environmental sustainability, and infrastructure.
The document also presents updated data on critical economic indicators such as inflation, trade and balance of payments, public debt, population growth, employment levels, and climate change impacts. By offering a consolidated view of these indicators, the survey aims to inform public debate and policy planning in the lead-up to the new fiscal year.
Meanwhile, the NEC emphasised that recent signs of “economic stabilisation” were the result of coordinated efforts by the federal and provincial governments.
It stated that the country has now moved onto a path of economic recovery and growth, with the agriculture sector playing a particularly important role in strengthening national reserves and supporting economic expansion.
“A comprehensive strategy is currently being formulated to ensure a steady and sustainable increase in agricultural productivity in the coming years,” it said.
In terms of development spending, a total outlay of Rs3,483bn has been approved for the Annual National Development Programme (ANDP) for 2024–25. Of this amount, Rs1,100bn was allocated for federal development initiatives, while Rs2,383bn was utilised by provincial governments for their respective projects.