Pakistan's New Infrastructure Investments and Trade Routes

Pakistan has recently launched 5G wireless service in multiple cities and closed financing on the 306 kilometer 6-lane Sukkur-Hyderabad M6 motorway. In addition, Pakistan is seeing significant increase in the utilization of its Gwadar and Karachi ports after the closure of the Strait of Hormuz due to the US-Iran war. This will help open the trade routes from Pakistan to Central Asia via Iran, bypassing unstable Afghanistan. It has the potential to eventually make Pakistan a major transshipment hub for the region extending to the land-locked Central Asian Republics. Another major news is the Asian Development Bank financing of cross-border connectivity of the power grid and digital networks. These developments are expected to substantially enhance economic activity in the country, in spite of the short-term negative impact of the energy crisis, particularly in oil and gas imports. 



5G Launch:

Wireless carriers Jazz and Zong have launched 5G services across Pakistan in March 2026.  This will further expand and enhance Pakistan's digital public infrastructure. Jazz launched its 5G service across major cities, including in Islamabad, Rawalpindi, Lahore, Karachi, Peshawar, Quetta, Multan, and Faisalabad. Meanwhile, Jazz's competitor Zong is targeting over 16 cities with 5G speeds exceeding 1.4Gbps. 

During the March auction, a total of 480 MHz of spectrum was sold across multiple bands for over $500 million, with Pakistan's main telcos, Jazz, Ufone, and Zong, snapping up the assets. Pakistan Telecommunication Authority (PTA) put a total of 597 MHz of spectrum on the table, with just over 100 MHz of this going unsold.

M6 Motorway:

Pakistan has signed an agreement with the Asian Development Bank (ADB) for $235 million in financing for two sections (120 miles) of the M6 motorway in Sindh province. The Islamic Development Bank (IDB) and the OPEC Fund have already agreed to finance three other sections of this motorway. 

The M-6 motorway is the only missing segment in the north-south motorway route linking Karachi to Peshawar. The 306-kilometer-long, six-lane motorway will have 15 interchanges and 10 service areas.

Cross-Border Grid Connectivity:

Pakistan is joining the Pan-Asia Power Grid Initiative sponsored and financed by the Asian Development Bank which will provide $50 billion for power and $20 billion for digital infrastructure. The project will link grids, boost power trading, improve broadband and develop AI-ready communities across Asia, the Pacific. 

Iran Trade Routes:

Pakistan has opened six land transit routes for goods destined for Iran, creating a road corridor through its territory as thousands of containers remain stranded at Karachi port because of the United States blockade of Iranian ports and ships trying to pass through the Strait of Hormuz.

This development signals a major shift away from the Gulf trade infrastructure Iran had long relied upon, particularly through Jebel Ali Port in the United Arab Emirates. This represents an opportunity for Pakistan to create new trade routes to Central Asian Republics bypassing Afghanistan, eventually making Pakistani ports a major transshipment hub for the entire region. 

Pakistan's newest Gwadar Port has already seen a major surge in activity, handling around 11,000 containers in April 2026 alone, surpassing its entire 2025 volume. The increase comes as shipping companies adjust routes due to disruptions near the Strait of Hormuz, pushing traffic toward safer alternatives.

Space Program:

Pakistan's space agency SUPARCO has achieved a major milestone by launching five indigenous satellites over the last 16 months (early 2025 – April 2026), marking a shift toward rapid space technology expansion. The fleet, aimed at Earth observation and agriculture, includes EO-1, EO-2, AI-powered EO-3, and Pakistan's first hyperspectral satellite, HS-1. 

HS-1 is Pakistan's first hyper-spectral  satellite which is equipped with advanced hyperspectral imaging sensors capable of capturing data across hundreds of narrow spectral bands.  The satellite lifted off from China’s Jiuquan Satellite Launch Center on a Kinetica-1 rocket. It is expected to boost Pakistan's national capacities in areas such as precision agriculture, environmental monitoring, urban planning, and disaster management. Its high-resolution data will support improved resource management and strengthen Pakistan’s resilience to climate-related challenges. 

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Comment by Riaz Haq 2 hours ago

Manufacturing posts strongest growth in four years as inflation eases sharply
Foreign reserves, remittances rise while fiscal deficit narrows to 0.7 percent of GDP

ISLAMABAD: Pakistan’s economy expanded 3.7 percent and reached a record size of $452.1 billion in the outgoing fiscal year 2025-26, according to the Economic Survey released on Thursday, as the government highlighted gains in manufacturing, inflation and external-sector indicators ahead of the federal budget.

The Economic Survey is an annual government document that reviews the performance of key sectors in the outgoing fiscal year and is traditionally released a day before the federal budget. Pakistan’s federal budget for FY2026-27 is due to be presented on June 12.

The survey showed Pakistan’s GDP growth increased to 3.7 percent in FY26 from 3.2 percent in FY25 and 2.6 percent in FY24, while the size of the economy expanded to Rs126.9 trillion, equivalent to $452.1 billion, the largest recorded economic size in the country’s history. Per capita income rose to $1,901 from $1,751 a year earlier.

The survey attributed the improvement to stronger manufacturing activity, easing inflation and a more stable external position despite regional tensions, volatile energy prices and global economic uncertainty.

“If I were sitting with you in January or February, we had a very strong view that this year’s growth will exceed 4 percent. But as you all know, we were affected by the conflict in the Middle East,” Finance Minister Muhammad Aurangzeb told reporters while unveiling the survey in Islamabad, referring to the ongoing US-Israel-Iran war.

“Having said that, we have reached the biggest economic volume in the history of the country, which has reached Rs126.9 trillion or $452.1 billion.”

One of the strongest contributors to growth was large-scale manufacturing, which expanded 6.1 percent during FY26, its highest growth rate in four years. According to the survey, 16 of 22 manufacturing sectors recorded positive growth, including food, textiles, automobiles, petroleum products and electrical equipment.

Average consumer inflation stood at 6.7 percent during the July-May period, compared with 4.5 percent in FY25 and 23.4 percent in FY24, according to the survey, which said price stability was largely maintained despite the impact of regional conflict on energy prices.

Pakistan’s external accounts also showed improvement. The current account deficit stood at $252 million during July-April, while foreign exchange reserves rose to $17.2 billion by May 29, up 49 percent from a year earlier.

Workers’ remittances reached $33.9 billion during July-May, up 9 percent year-on-year, while monthly inflows hit a record $4.3 billion in April, according to the survey.

The country’s trade deficit stood at $23.53 billion during July-March.

------------

https://x.com/ArifHabibLtd/status/2065012155041370283?s=20


Sheheryar Butt
@PSX100
Pakistan Economic Survey 2025-26 – Key Highlights

📈 GDP Growth

Economic Growth: 3.7% (Target: 4.2%)
Agriculture Growth: 2.9%
Industrial Growth: 3.5%
Services Sector Growth: 4.1%

💰 Macroeconomic Indicators

Per Capita Income: US$ 1,901
Investment-to-GDP Ratio: 14.3%
Savings-to-GDP Ratio: 14.1%

🏭 Large Scale Manufacturing (LSM) Performance

Overall LSM Growth: 6.5% ▲

Major Performing Sectors

Food: 9.8% ▲
Coke & Petroleum Products: 10.9% ▲
Wearing Apparel: 6.6% ▲
Textile: 0.7% ▲
Mining & Quarrying: 0.4% ▲

Weak Performing Sectors

Chemicals: -1.4% ▼
Pharmaceuticals: -5.1% ▼
PSX Perspective

✅ Strong growth in LSM, Food, Petroleum Products, and Apparel is positive for related listed companies.

⚠️ Weak performance in Chemicals and Pharmaceuticals may keep investor sentiment cautious toward these sectors.

📊 Overall, the survey indicates a gradual economic recovery, though GDP growth remained below the government's target of 4.2%.

https://x.com/PSX100/status/2065020729436049561?s=20

Comment by Riaz Haq 2 hours ago

Manufacturing posts strongest growth in four years as inflation eases sharply
Foreign reserves, remittances rise while fiscal deficit narrows to 0.7 percent of GDP

ISLAMABAD: Pakistan’s economy expanded 3.7 percent and reached a record size of $452.1 billion in the outgoing fiscal year 2025-26, according to the Economic Survey released on Thursday, as the government highlighted gains in manufacturing, inflation and external-sector indicators ahead of the federal budget.

The Economic Survey is an annual government document that reviews the performance of key sectors in the outgoing fiscal year and is traditionally released a day before the federal budget. Pakistan’s federal budget for FY2026-27 is due to be presented on June 12.

The survey showed Pakistan’s GDP growth increased to 3.7 percent in FY26 from 3.2 percent in FY25 and 2.6 percent in FY24, while the size of the economy expanded to Rs126.9 trillion, equivalent to $452.1 billion, the largest recorded economic size in the country’s history. Per capita income rose to $1,901 from $1,751 a year earlier.

The survey attributed the improvement to stronger manufacturing activity, easing inflation and a more stable external position despite regional tensions, volatile energy prices and global economic uncertainty.

“If I were sitting with you in January or February, we had a very strong view that this year’s growth will exceed 4 percent. But as you all know, we were affected by the conflict in the Middle East,” Finance Minister Muhammad Aurangzeb told reporters while unveiling the survey in Islamabad, referring to the ongoing US-Israel-Iran war.

“Having said that, we have reached the biggest economic volume in the history of the country, which has reached Rs126.9 trillion or $452.1 billion.”

One of the strongest contributors to growth was large-scale manufacturing, which expanded 6.1 percent during FY26, its highest growth rate in four years. According to the survey, 16 of 22 manufacturing sectors recorded positive growth, including food, textiles, automobiles, petroleum products and electrical equipment.

Average consumer inflation stood at 6.7 percent during the July-May period, compared with 4.5 percent in FY25 and 23.4 percent in FY24, according to the survey, which said price stability was largely maintained despite the impact of regional conflict on energy prices.

Pakistan’s external accounts also showed improvement. The current account deficit stood at $252 million during July-April, while foreign exchange reserves rose to $17.2 billion by May 29, up 49 percent from a year earlier.

Workers’ remittances reached $33.9 billion during July-May, up 9 percent year-on-year, while monthly inflows hit a record $4.3 billion in April, according to the survey.

The country’s trade deficit stood at $23.53 billion during July-March.

------------

https://x.com/ArifHabibLtd/status/2065012155041370283?s=20


Sheheryar Butt
@PSX100
Pakistan Economic Survey 2025-26 – Key Highlights

📈 GDP Growth

Economic Growth: 3.7% (Target: 4.2%)
Agriculture Growth: 2.9%
Industrial Growth: 3.5%
Services Sector Growth: 4.1%

💰 Macroeconomic Indicators

Per Capita Income: US$ 1,901
Investment-to-GDP Ratio: 14.3%
Savings-to-GDP Ratio: 14.1%

🏭 Large Scale Manufacturing (LSM) Performance

Overall LSM Growth: 6.5% ▲

Major Performing Sectors

Food: 9.8% ▲
Coke & Petroleum Products: 10.9% ▲
Wearing Apparel: 6.6% ▲
Textile: 0.7% ▲
Mining & Quarrying: 0.4% ▲

Weak Performing Sectors

Chemicals: -1.4% ▼
Pharmaceuticals: -5.1% ▼
PSX Perspective

✅ Strong growth in LSM, Food, Petroleum Products, and Apparel is positive for related listed companies.

⚠️ Weak performance in Chemicals and Pharmaceuticals may keep investor sentiment cautious toward these sectors.

📊 Overall, the survey indicates a gradual economic recovery, though GDP growth remained below the government's target of 4.2%.

https://x.com/PSX100/status/2065020729436049561?s=20

Comment by Riaz Haq 2 hours ago

Does official gdp include undocumented economy in pakistan?

No, official GDP figures in Pakistan do not include the undocumented or informal economy. Official statistics only track registered, formal-sector transactions, meaning cash trades, barters, and unregistered small businesses are omitted from the primary Official Pakistan GDP tally.Key Facts About Pakistan's Undocumented Economy:Scale: The undocumented economy is massive. Estimates by the World Bank and International Labour Organization place its value at approximately $457 billion, which constitutes over 40% to 56% of the country's official, documented GDP.Employment: Up to 72% of the non-agricultural workforce and nearly three million businesses operate in the informal sector, sustaining massive consumer demand that goes untracked by the Federal Board of Revenue.True Economic Size: When informal and shadow-market wealth are factored in, some economists and independent researchers estimate Pakistan's true purchasing power and adjusted GDP could approach $800 to $900 billion.To understand the full scope of unrecorded economic activity, would you like to:Learn more about how institutions like the State Bank of Pakistan measure shadow wealth?Review government initiatives aiming to bring informal sectors into the official tax net?Explore how these unrecorded figures impact per-capita purchasing power metrics?

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