KARACHI: Governor of the State Bank of Pakistan, Jameel Ahmad, announced on Friday that Pakistan’s economy has witnessed a dramatic recovery over the past three years, with foreign exchange reserves surging from a critically low $3 billion to $17 billion and remittances expected to cross a record-breaking $41 billion during the current fiscal year.
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Speaking during an interactive session at the Karachi Chamber of Commerce and Industry, the SBP governor said the country’s external sector had stabilized significantly despite global economic uncertainty and rising tensions in the Middle East.
He recalled that in 2023 Pakistan faced severe economic stress, with imports shrinking sharply and businesses struggling to open Letters of Credit (LCs). “Today, average monthly imports have exceeded $5 billion compared to nearly $3 billion three years ago, while the LC situation has improved substantially,” he said.
Jameel Ahmad stated that reforms introduced by the central bank, along with strict action against hundi and hawala networks, played a key role in strengthening Pakistan’s foreign exchange reserves and restoring confidence in the economy.
He revealed that remittances, which stood at $38 billion last fiscal year, are now projected to exceed $41 billion — the highest level in Pakistan’s history.
The SBP governor further said Pakistan’s current account remained in surplus during the first nine months of FY26, while the overall deficit was expected to remain between zero and one percent. “Pakistan’s external account is now in a much stronger and healthier position,” he remarked.
GDP Growth and Inflation Outlook
According to Jameel Ahmad, the Pakistan Bureau of Statistics estimated GDP growth at 3.7 percent during the first nine months of FY26, while the central bank expects annual growth to remain between 3.75 and 4.75 percent.
He cautioned that inflation could temporarily rise above 7 percent during the final quarter of FY26 due to global uncertainties and oil price fluctuations. However, he reaffirmed the State Bank’s commitment to maintaining inflation within its medium-term target range of 5 to 7 percent.
SME Financing Sees Major Growth
Highlighting the central bank’s focus on Small and Medium Enterprises (SMEs), the SBP governor said regulations had been simplified and banks instructed to introduce dedicated SME growth plans.
He disclosed that SME financing increased from Rs491 billion in June 2024 to Rs882 billion by December 2025, with a target of reaching Rs1.5 trillion by June 2028.
“Pakistan’s future GDP growth is directly linked with SME expansion,” he emphasized, adding that a simplified one-page loan application form had also been introduced for SMEs.
Exports Face Pressure
Discussing exports, Jameel Ahmad said declining international commodity prices and weak global demand had negatively affected export earnings.
He noted that while rice exports of $3.5 billion boosted exports last year, falling global rice prices reduced export revenues by nearly $1 billion this year. Overall exports are expected to stand near $30 billion this year compared to $32 billion last year.
Despite the slowdown, he said the government was pursuing corrective measures and positive results were expected within the next two months.
New Currency Notes and Virtual Assets Framework
In a major development, the SBP governor confirmed that the designs for Pakistan’s new currency notes had been finalized and sent to the federal cabinet for approval.
He also clarified that exchange company rates are determined entirely by market forces and that the State Bank has no direct role in fixing exchange rates.
Additionally, he revealed that work was progressing on Pakistan’s licensing and regulatory framework for virtual assets.
Business Community Raises Concerns
Chairman BMG Zubair Motiwala praised overseas Pakistanis for supporting the economy through strong remittance inflows and urged them to continue supporting the country amid ongoing Middle East tensions.
He stressed that high energy tariffs, along with elevated interest rates, remained a major burden on industries and exporters.
Vice Chairman BMG Jawed Bilwani said excessive government borrowing from banks was restricting private sector lending and industrial growth.
President KCCI Rehan Hanif appreciated the role played by the State Bank during the country’s economic crisis and called for reforms to ease valuation and financing hurdles faced by businesses and SMEs.
