Pakistan has set a 4 percent economic growth target for fiscal year 2026-27, reflecting the government’s expectation that ongoing reforms and increased private-sector activity will support a stronger expansion of the economy.

The target was outlined in a working paper prepared for the Annual Plan Coordination Committee (APCC), which met in Islamabad to review development priorities and economic projections for the upcoming fiscal year.

According to the plan, agriculture is expected to grow by 3.8 percent, while large-scale manufacturing is projected to expand by 4.5 percent. Overall growth in commodity-producing sectors has been estimated at 3.9 percent.

The industrial sector is expected to record 4 percent growth during FY27, while the services sector is projected to remain the largest contributor to economic activity with an anticipated growth rate of 4.2 percent.

Officials expect economic performance to be supported by measures aimed at boosting exports, improving productivity, accelerating digital adoption, strengthening climate resilience and advancing reforms in the energy sector. The government is also counting on greater private-sector investment to drive growth.

The new target comes as Pakistan seeks to maintain economic stability under its reform agenda backed by the International Monetary Fund. However, policymakers acknowledge that external factors, including volatility in international oil markets and geopolitical tensions in the Middle East, could influence economic outcomes during the year.

Despite these challenges, the government remains optimistic that continued reforms and macroeconomic stability will help sustain the country’s growth momentum in FY2026-27.