Federal Minister for Planning, Development and Special Initiatives and Deputy Chairman Planning Commission, Ahsan Iqbal, has emphasized that Pakistan’s economic recovery must be built on export-led growth, fiscal discipline, productive investment and effective service delivery, while ensuring that development resources reach underserved areas and generate tangible benefits for citizens. The Minister for Planning Ahsan Iqbal, presented the Monthly Development Update for October 2026 here in Islamabad on Thursday.
Sharing the country’s economic and development performance for the first quarter of FY2026-27, the minister said merchandise exports increased by 7.7 percent to $8.5 billion during July–September, compared with $7.9 billion in the corresponding period last year. Combined exports of goods and services rose by 11 percent to $11.2 billion, supported by 22.8 percent growth in services exports. ICT exports reached $1.2 billion, while food exports grew by 17.1 percent, petroleum products by 44.5 percent, engineering goods by 4.9 percent and textiles by 2.5 percent.
Workers’ remittances increased by 14 percent to $10.9 billion, compared with $9.5 billion a year earlier, with Saudi Arabia contributing $2.6 billion, the United Arab Emirates $2.2 billion, the United Kingdom $1.6 billion and the United States approximately $931 million. The minister acknowledged the vital contribution of overseas Pakistanis and stressed that the country must significantly expand its own export capacity rather than rely disproportionately on remittances and external financing.
Ahsan Iqbal said Pakistan must develop an export-oriented culture across the country by identifying competitive products in every province and district. He said he had written to provincial chief ministers to encourage the establishment of provincial export boards and the preparation of district-level export development plans. These initiatives would identify opportunities in agriculture, handicrafts, engineering, technology and other sectors, strengthen domestic value chains and connect local producers with international markets. He reiterated that achieving the government’s long-term export ambitions under URAAN Pakistan was essential to reducing external vulnerabilities and securing economic sovereignty.
The minister said Pakistan recorded GDP growth of 3.7 percent in FY2025-26, while the government is targeting 4 percent growth in the current fiscal year. Preliminary estimates for the Kharif season showed maize production increasing by 12.1 percent, sugarcane by 8.8 percent and rice by 1.8 percent. Large-scale manufacturing recorded 1.9 percent growth during the first two months of FY2026-27, with 12 of 22 industrial groups registering positive growth.
Imports of goods rose by 14.3 percent to $17.8 billion, while combined imports of goods and services increased by 14.6 percent to $21.3 billion. Machinery imports grew by 10.7 percent and raw material imports by 28 percent, reflecting increased demand for industrial inputs and production capacity. The minister said this momentum must translate into higher domestic value addition and exports. The current account deficit widened to $874 million, compared with $755 million in the corresponding period last year, while FBR tax collection increased by 7 percent to Rs3.086 trillion.
Addressing inflation and the rising cost of living, Ahsan Iqbal said global uncertainty and increases in international energy prices required a prudent approach to economic management. Monthly inflation eased to 10.3 percent in September from 11.1 percent in August, although it remained above the level recorded a year earlier. He said the government was strengthening market surveillance through the National Price Monitoring Committee to curb excessive wholesale-retail margins and prevent profiteering. He emphasized that relief for vulnerable households must be expanded without compromising macroeconomic stability or repeating past policy decisions that could expose the country to renewed financial pressures.
The minister said approximately 12.7 million people had registered under the government’s targeted relief initiative. He added that a committee comprising government representatives, including Deputy Prime Minister Ishaq Dar, himself and Rana Sanaullah, alongside representatives of Jamaat-e-Islami, would examine options for extending relief and develop practical proposals for a phased reduction in the petroleum levy in the next budget. He stressed that relief measures must be sustainable and carefully assessed in view of the uncertainty surrounding global energy prices.
Turning to public sector development, Prof. Ahsan Iqbal said Rs61.3 billion had been utilized under the Public Sector Development Programme during the first quarter of FY2026-27. The water sector utilized Rs13.4 billion, transport and communications Rs12.6 billion, and education, including the Higher Education Commission, Rs7.8 billion. During September, the Central Development Working Party considered 37 agenda items, approving 13 projects, deferring four, returning three to the concerned ministries and recommending seven projects to ECNEC.
He said rigorous scrutiny of development projects had generated savings of Rs7 billion in September, taking cumulative savings to Rs14.5 billion during the first quarter. The Planning Commission would continue to eliminate unnecessary costs, improve project design and ensure that public funds delivered maximum value. During July–September, the Ministry monitored 46 development projects and evaluated nine to identify implementation bottlenecks and assess progress against planned objectives.
Responding to questions about development funding for Khyber Pakhtunkhwa’s newly merged districts, the minister rejected the impression that allocations had been reduced, citing increased funding under the Accelerated Implementation Programme (AIP) and the Annual Development Plan (ADP). He said that the Federal Government had provided Rs 118 billion under the Accelerated Implementation Programme (AIP) over the past four years during the current government’s tenure, compared with Rs 82 billion during the previous government’s four-year tenure. This translates into average annual federal funding of Rs 29.5 billion, compared with approximately Rs 20 billion annually provided by the Khyber Pakhtunkhwa (KP) government.
The minister said the government had established a steering committee to strengthen oversight and ensure that funds were spent on projects that directly benefit local communities. He highlighted police infrastructure as a particular priority, saying Rs8 billion had been provided for this purpose in the previous year and another Rs7 billion was being allocated in the current year, taking the total to Rs15 billion. He stressed that effective policing and counterterrorism infrastructure were essential to restoring peace and security in the newly merged districts. The government would also prioritize education, healthcare, skills development and employment opportunities for local youth. On the Prime Minister's directives, a project to provide solar energy to 50,000 homes in the merged districts will commence soon, says Ahsan Iqbal.
On governance reforms, Prof. Ahsan Iqbal called for stronger and constitutionally protected local governments, arguing that excessive centralization of authority at the provincial level had weakened public service delivery. He advocated the devolution of administrative and financial powers to empowered local governments across districts, enabling provinces to concentrate on policymaking, regulation and performance monitoring. He said effective local governance was essential to improving outcomes in education, healthcare and other social sectors, and that efforts were under way to build political consensus for constitutional protection of local government institutions.
The minister also highlighted the need to reduce electricity generation costs, address power-sector losses and theft, and improve the competitiveness of Pakistani industry through lower electricity tariffs, particularly for industrial consumers. He said relevant reforms were being pursued to reduce the cost of doing business and strengthen industrial productivity.
Reaffirming the government’s commitment to technology-led growth, Prof. Ahsan Iqbal said Quantum Valley Pakistan, launched in Islamabad on September 16, would bring academia, industry, entrepreneurs and investors together to develop the country’s quantum technology ecosystem. He also highlighted progress in semiconductor skills development and technology infrastructure, including the completion of the Islamabad Technology Park and preparations for the Karachi Technology Park.
The minister said Pakistan needed sustained annual economic growth of 5–6 percent to generate sufficient employment for new entrants into the labour market. However, he cautioned that growth driven primarily by consumption and imports would be unsustainable without a corresponding increase in exports. He stressed that higher productivity, export diversification, domestic revenue mobilization, energy-sector reforms and effective public investment were essential to achieving durable growth.
Prof. Ahsan Iqbal reiterated that URAAN Pakistan’s five Es—Exports, E-Pakistan, Environment and Climate Change, Energy and Infrastructure, and Equity and Empowerment—provide the framework for transforming economic stabilization into inclusive development. He said the government would continue to pursue reforms that strengthen economic resilience, expand employment opportunities, improve public services and ensure that development reaches every part of the country.
