Islamabad (Commerce Desk): In a report released by the World Bank, it has been stated that ongoing tensions in the Middle East are affecting the economies of several countries, including Pakistan, while rising oil and gas prices are increasing inflationary pressure.
According to the report, Pakistan’s economic growth is likely to fall short of the annual target of 4.2%, with growth expected to remain around 3% in the current fiscal year, compared to an earlier estimate of 3.4%.
The World Bank noted that the GDP growth rate stood at 3.1% in the previous fiscal year, while inflation is projected to rise to 7.4% by 2026.
The report also forecasts a shift in the current account from surplus to deficit, estimating it could reach 1.2% of GDP in fiscal year 2026. However, the fiscal deficit is expected to narrow to 4.3%.
Additionally, concerns have been raised about a potential decline in remittances from Gulf countries, along with negative impacts on tourism and investment. The report also highlighted a downturn in the Pakistan Stock Exchange and described rising energy prices as a major risk to the economy.
