Pakistan could triple incomes by 2050 if it speeds up economic reforms and attracts more private investment, according to the World Bank’s latest Pakistan Development Update.

The lender said annual economic growth could rise to between 6.2 percent and 6.9 percent with the right reforms, potentially bringing Pakistan to Vietnam’s current income level by 2050.

Pakistan’s economy grew 3.7 percent in fiscal year 2026, compared with 3.2 percent in the previous year. The primary fiscal surplus also reached 2.9 percent of gross domestic product (GDP).

However, economic growth is still translating into limited income gains for ordinary Pakistanis. Real per capita growth remains around 1.6 percent, restricting improvements in average living standards.

The World Bank said Pakistan needs to improve its business environment, overhaul its tax system, reduce the government’s role in the economy and make financing more accessible to businesses. Trade liberalization, power sector reforms and privatization are also among the key priorities.

The challenge comes as poverty continues to weigh on the economy. The World Bank reported that Pakistan’s poverty rate rose to 29 percent in fiscal year 2025, leaving around 70 million people below the national poverty line.

The lender said economic stabilization has given Pakistan an opportunity to pursue stronger growth. However, turning that opportunity into higher incomes will require sustained reforms, greater private investment and more jobs.

Pakistan’s ability to raise living standards over the coming decades will depend on whether it can move beyond modest growth and build an economy that supports higher productivity, business expansion and employment.