Savings target set at 14.3pc of GDP
Pakistan's federal government has set ambitious economic targets for FY 2026-27, aiming for 4.0% GDP growth, 14.3% national savings, and 2 million new jobs, despite potential external sector pressures.
- National savings and investment targets for FY 2026-27.
- Projected economic growth and job creation.
- Inflation targets and external sector pressures.
ISLAMABAD: The federal government has set the national savings target at 14.3 percent of GDP for the fiscal year 2026–27, while investment is projected to reach 15 percent of GDP, indicating a narrowing savings–investment gap to be financed through modest external inflows.
According to budget documents available with this correspondent, public investment (including general government investment) is projected to remain at 3.0 percent of GDP, while private investment is estimated to rise to 10.3 percent of GDP in the fiscal year 2026–27.
Inflation is targeted at 8.2 percent, supported by fiscal consolidation and improved macroeconomic stability.
However, the external sector may face pressures as easing import controls and debt repayments are likely to widen the current account deficit.
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Nevertheless, strong remittance inflows, export recovery, and anticipated external financing are expected to cushion these pressures and support external sector stability.
According to official documents Pakistan’s economy is projected to grow by 4.0 percent next fiscal year, signaling a continued growth trajectory.
The commodity-producing sector is expected to expand by 3.9 percent, driven by 3.8 percent growth in agriculture and 4.5 percent growth in Large Scale Manufacturing (LSM). Agricultural growth will be supported by a recovery in major crops (3.6 percent) and cotton ginning (2.5 percent), along with strong performance in livestock (3.9 percent).
The industrial sector is projected to grow by 4.0 percent, mainly due to a revival in LSM as well as growth in mining and quarrying, construction, and energy (gas and water supply). The services sector is expected to grow by 4.2 percent, supported by stronger performance in wholesale and retail trade (4.2 percent), transport, storage, and communications (3.7 percent), financial services (4.5 percent), and information and communication (7.7 percent).
These targets are contingent upon effective macroeconomic management and stable external conditions.
The government has set a target of creating 2.0 million jobs in the fiscal year 2026–27 through higher investment and improved economic growth. Public investment is expected to crowd out private investment, thereby expanding employment opportunities across all sectors.
Copyright Business Recorder, 2026
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