Finance Minister Aurangzeb forecasts 3.5% GDP growth for FY26, with a $1.2 billion IMF tranche, single-digit inflation, and CPEC Phase II projects in 2025.
According to Finance Minister Muhammad Aurangzeb in an interview with CGTN America, Pakistan’s economy is expected to grow by 3.5% in FY26. This is despite the setbacks caused by floods. Inflation is currently in the single digits. Foreign reserves are sufficient to cover 2.5 months’ worth of imports. The GDP grew by 3% in FY25. The initial growth target for that year was 4%. However, it was slightly affected by the floods.
A $1.2 billion IMF tranche was secured through the Extended Fund Facility ($1 billion) and the Resilience and Sustainability Facility ($200 million). This brings the total disbursements to $3.3 billion. The IMF commended the macroeconomic stability, controlled inflation, and stronger financial buffers.
Finance Minister of Pakistan @Financegovpk, Muhammad Aurangzeb discusses the second phase of CPEC, highlighting investment priorities across key sectors. #Heat #Pakistan #China #CPEC pic.twitter.com/Rq3IPfXNWX
— CGTN America (@cgtnamerica) October 21, 2025All three major rating agencies upgraded Pakistan’s credit outlook. Aurangzeb highlighted homegrown reforms across people, processes, and technology, guided by PM Shahbaz Sharif.
The finance minister revealed that Pakistan plans to re-enter global capital markets. This will start with its first green bond denominated in Chinese yuan by the end of 2025. This will be followed by a $1 billion international bond issuance, aimed at diversifying funding sources and attracting sustainable investment.
Read: World Bank Projects Pakistan’s GDP Growth at 2.6% for 2025-26
Aurangzeb said IMF support since September 2024 has been instrumental in stabilising Pakistan’s $370 billion economy. The economy was hit hard by a balance-of-payments crisis that caused a steep currency depreciation. “We are regaining economic credibility, strengthening reserves, and rebuilding trust with international partners,” Aurangzeb added.
