Federal Minister for Planning, Development and Special Initiatives Prof. Ahsan Iqbal on Thursday launched the Ministry of Planning's Monthly Development Update – July 2026 while outlining the government's economic priorities, development agenda and strategic direction for fiscal year 2026-27.
Addressing a media briefing, he said Pakistan had successfully moved its economy away from the risk of default and put it on the path of recovery and stability. He said the government’s priority now was to protect this economic stability and turn it into sustainable growth, increased investment, more employment opportunities and shared prosperity under the Uraan Pakistan national transformation framework.
The minister observed that the global economy continues to face an exceptionally challenging environment marked by geopolitical tensions, disruptions in energy supply chains, volatility in international oil prices and uncertainty in global trade. These developments, he noted, pose significant challenges for developing economies and demand prudent economic management, fiscal discipline and a resilient policy framework.
He said Pakistan remains firmly committed to strengthening macroeconomic stability despite these external headwinds. "The economic stability achieved today is the outcome of difficult but necessary decisions, public sacrifice, improved fiscal discipline and effective economic management," he remarked, stressing that safeguarding this stability at all costs remains the government's highest national priority.
Presenting key economic indicators, the Planning Minister said Pakistan's economy demonstrated a broad-based recovery during fiscal year 2025-26, with GDP growth improving from 3.2 percent to 3.7 percent.
He said agriculture expanded by 2.9 percent, services recorded 4.1 percent growth, while the industrial sector maintained positive momentum with 3.5 percent growth. The combined performance of agriculture, industry and services significantly strengthened overall economic growth.
The Minister said international institutions have acknowledged Pakistan's progress in economic reforms, institutional strengthening and improvement in foreign exchange reserves, reflecting growing confidence in the country's economic direction.
Despite global inflationary pressures, he said inflation remained contained at 7.1 percent during fiscal year 2026-27, below the government's target of 7.5 percent, reflecting effective economic management.
Highlighting improvements in the external sector, Prof. Ahsan Iqbal said workers' remittances increased by 8.6 percent, rising from US$38.3 billion to US$41.6 billion during fiscal year 2025-26, providing critical support to millions of Pakistani households while strengthening the country's external financial position.
He said total exports of goods and services reached US$40.9 billion, while services exports registered a remarkable 18.7 percent increase, growing from US$8.5 billion to US$10 billion, reflecting Pakistan's improving export competitiveness.
Despite global uncertainty and rising imports, the current account deficit remained contained at only US$139 million, demonstrating the country's continued fiscal and external sector discipline.
The Minister announced that the government has set a 4 percent GDP growth target for fiscal year 2026-27, emphasising that growth must be achieved without repeating the fiscal and external imbalances of the past.
He said future economic expansion would be driven by higher productivity, exports, investment, innovation and adoption of modern technologies, while strengthening the role of the private sector in accelerating sustainable growth.
"The next phase of economic policy is to convert macroeconomic stability into investment, jobs and improved living standards," he said, adding that ensuring the benefits of economic stability reach every citizen remains the government's foremost priority.
He said the government will focus on protecting purchasing power, reducing poverty, supporting vulnerable segments of society and creating dignified employment opportunities, particularly for youth.
Addressing concerns over petroleum prices, the minister said adjustments in petroleum product prices are directly linked to fluctuations in international oil markets and are necessary to maintain macroeconomic balance and fiscal discipline.
He noted that in the past, petroleum prices were artificially suppressed despite rising global oil prices, creating severe economic distortions. The present government, he said, is pursuing long-term national interests by taking economically responsible decisions.
He assured that if international oil prices decline, the government remains committed to passing the relief on to consumers.
The Minister further announced strict enforcement of OGRA-notified prices and warned of action against fake notifications, profiteering and hoarding. He also directed authorities to prevent unjustified increases in transport and freight charges while ensuring uninterrupted supply of petroleum products across the country.
Sharing industrial performance, Prof. Ahsan Iqbal said Large Scale Manufacturing (LSM) recorded 5.8 percent growth during July-May of fiscal year 2025-26, compared to a contraction of 1.1 percent in the previous year.
Out of 22 major industrial groups, 16 recorded positive growth, with the automobile sector registering an exceptional 58.8 percent increase. Significant growth was also recorded in electrical equipment, tobacco, food, textiles, beverages and mineral products, indicating broad-based industrial recovery.
The Minister said Federal Board of Revenue (FBR) revenues increased from Rs11.7 trillion to Rs13 trillion, while the revenue target for the next fiscal year has been set at over Rs15.2 trillion.
He said fiscal reforms have strengthened the national exchequer, while improved implementation of development projects and efficient expenditure management enhanced the performance of the national development programme.
He added that higher development spending also reflected third-party payments for projects in water resources, hydropower, energy and revenue sectors.
Reviewing the development portfolio, Prof. Ahsan Iqbal said the Central Development Working Party (CDWP) held 21 meetings during fiscal year 2025-26, considering 330 development agenda items.
Of these, 192 agenda items were approved, while 96 projects were referred to ECNEC for final approval.
In June 2026 alone, the CDWP held three meetings, reviewed 72 agenda items, approved 49 proposals, and referred 21 projects to ECNEC.
He said development projects approved during fiscal year 2025-26 are expected to generate approximately 289,000 direct and 424,000 indirect employment opportunities, while rigorous economic and financial appraisal of projects resulted in national savings of Rs12.6 billion.
The Planning Minister said a proposal has been developed to transform Islamabad into a Smart City through improved public service delivery, citizen participation, democratic governance and a stronger local government framework.
Highlighting education reforms, he directed a comprehensive review of higher education curricula to align universities with the requirements of the Fourth and Fifth Industrial Revolutions.
He said outdated degree programmes that no longer correspond to national and international market needs would be phased out in consultation with the Higher Education Commission (HEC), while new programmes focused on future skills will be introduced. He announced that teacher training will also be modernised alongside curriculum reforms to ensure effective implementation.
Under Uraan Pakistan, he said, equipping young Pakistanis with future-ready skills remains a national priority through initiatives including digital literacy, laptops, cybersecurity, satellite technologies, genomics and emerging technologies.
Sharing outcomes of his recent visit to the United States, Prof. Ahsan Iqbal said the visit created new opportunities for collaboration in higher education, research, innovation and technology.
He said the Ministry of Planning is working with the Higher Education Commission to develop a comprehensive reform agenda for Pakistan's higher education system.
The Minister disclosed that the University of Illinois Chicago has expressed interest in establishing a campus in Pakistan, while discussions with leading American universities focused on expanding cooperation in education, research and faculty development.
He also announced that the government is reviving the U.S.-Pakistan Knowledge Corridor Programme to create new opportunities for Pakistani students, researchers and faculty members.
Describing Pakistan's youth as the country's greatest national asset, he stressed that future competitiveness depends upon preparing young people in fields such as artificial intelligence, big data, biotechnology, satellite technologies and genomics, rather than relying solely on traditional disciplines.
He said Pakistan must develop a robust digital ecosystem to emerge as a major global digital hub.
The Minister further revealed that new avenues for digital investment and technological collaboration opened during the U.S. visit, adding that internationally renowned technology companies are being encouraged to establish operations in Pakistan. He announced that Plug and Play, one of the world's leading innovation platforms, plans to establish an office in Pakistan to support entrepreneurship, innovation and technology-driven economic growth.
Prof. Ahsan Iqbal also highlighted Pakistan's expanding international cooperation, stating that Pakistan and Türkiye have agreed to deepen collaboration in agricultural modernisation, climate resilience and agricultural technologies.
He said Pakistan and Uzbekistan have agreed to enhance cooperation in education, trade, transport, agriculture and regional connectivity.
Similarly, Pakistan and Denmark reaffirmed their commitment to expanding cooperation in sustainable water resource management, climate resilience, research, technical collaboration, knowledge exchange and innovation.
Concluding the briefing, the Planning Minister reiterated that while the government remains vigilant against global economic shocks, its overriding objective is to preserve macroeconomic stability, accelerate reforms under Uraan Pakistan, strengthen exports and investment, empower youth through future-oriented education and technology, and ensure that the dividends of economic recovery reach every citizen.
