Karachi – May 30, 2025: ICMA’s Research and Publications Department has released its Q3 FY2025 (Jan-Mar) macroeconomic review, presenting a snapshot of Pakistan’s economic performance based on its infographic-based analysis. The report highlights both challenges and areas of resilience in the economy.
The most concerning trend is the continued contraction in the industrial sector, which recorded a negative growth rate of –1.14% during the quarter. The Quantum Index of Large-Scale Manufacturing (QIM) dropped from 130.25 in Jan-25 to 117.20 in Mar-25, indicating a slowdown in manufacturing output. The automotive industry, in particular, saw a decline, with car production falling from 10,925 units in Jan-25 to 7,631 units in Mar-25. Meanwhile, the cement sector dispatched 11.06 million tons during the quarter, including 1.72 million tons of exports.
Despite industrial challenges, the services sector showed strong momentum with a 3.99% growth, while agriculture posted modest growth of 1.18%. On the fiscal side, the Federal Board of Revenue (FBR) collected Rs. 2,827 billion in taxes—falling short of the Rs. 3,160 billion targets by Rs. 333 billion. Each month recorded a revenue shortfall, reflecting ongoing fiscal stress.
Foreign investment remained weak, with total foreign investment at just $54.3 million. However, foreign private direct investment (FPDI) reached $314.9 million, with China contributing $149 million. In contrast, workers’ remittances remained a stable source of foreign exchange, totaling $10.18 billion. Saudi Arabia, the U.A.E., and the UK remained the top contributors.
The current account posted a surplus of $699 million, aided by a strong $1,195 million surplus in Mar-25. However, the trade deficit remained wide at $7.91 billion, with exports of $8.37 billion and imports of $15.45 billion. SBP’s foreign exchange reserves fell from $11.4 billion in Jan-25 to $10.6 billion in Mar-25, while commercial banks’ reserves slightly increased.
Inflation showed an upward trend, with the Consumer Price Index (CPI) rising from 0.2% in Jan-25 to 0.9% in Mar-25 on a month-on-month basis. The Sensitive Price Index (SPI) moved from –1.4% to –0.1%, indicating rising prices of essential goods.
In the banking sector, deposits and investments increased, while total advances fell to Rs. 13.47 trillion by Mar-25. Company registrations continued to grow, with 9,245 new companies incorporated during the quarter. The IT & E-Commerce sector led with 1,839 new registrations, followed by the trading sector with 1,202.
Domestic debt rose from Rs. 50.24 trillion to Rs. 51.52 trillion, while external debt increased from Rs. 21.88 trillion to Rs. 22.17 trillion. Among foreign donors, Japan and Germany were key contributors, providing $18.91 million and $9.11 million respectively.
Roshan Digital Account inflows reached $29.34 billion during the quarter, supporting the external account. The Pakistan Stock Exchange remained positive, with the KSE-100 Index climbing from 114,255 to 117,807 points. Market capitalization also increased.
The Pakistani Rupee remained largely stable against the US Dollar, with only a slight movement from Rs. 281.00 to Rs. 281.90. Gold prices rose from Rs. 250,001 to Rs. 277,573 per 10 grams, while petrol prices dropped marginally from Rs. 256.13 per litre in January to Rs. 252.63 by mid-May.
ICMA’s analysis presents a mixed economic outlook. While services, remittances, and digital inflows show resilience, the persistent industrial slowdown and fiscal pressures highlight the need for timely policy action to revive industrial activity, attract investment, and strengthen macroeconomic stability.
