Pakistan could triple its incomes by 2050 if it speeds up structural reforms to boost private investment and sustain faster growth, the World Bank Group said on Thursday in its latest Pakistan Development Update, titled “Attaining Escape Velocity”, the Associated Press of Pakistan (APP) reported.

Source: APP via Tez Khabar

The report said sound policies in recent years had stabilised the economy and preserved growth despite the impact of the Middle East conflict. Real GDP growth rose to 3.7 percent in fiscal year 2026, up from 3.2 percent in FY25, APP reported.

Revenue growth and spending restraint produced a record primary fiscal surplus of 2.9 percent of GDP in FY26, while strong remittances helped rebuild foreign exchange reserves. The World Bank said those gains brought credit-rating upgrades from S&P and Moody's and allowed Pakistan to return to international debt markets with a $3 billion Eurobond — yaani 300 crore dollars of new borrowing.

“Pakistan has made real progress in restoring stability, and markets have taken notice,” World Bank country director for Pakistan Bolormaa Amgaabazar said at the launch. “But real per capita growth, the rate at which the income of the average Pakistani increases, remains stuck at around 1.6 percent. Reforms to drive faster growth are now urgently needed.”

Source: World Bank release via Pakistani News

What faster reform could deliver

Reforms that lift Pakistan's policies and institutions to the quality of an average middle-income country could drive sustained growth of 6.2 to 6.9 percent a year, the report found — enough for Pakistan to reach Vietnam's current income level by 2050, according to the World Bank release.

3.7%Pakistan real GDP growth in FY26, up from 3.2%
6.2–6.9%sustained growth the World Bank says reforms could deliver
1.6%real per-person income growth, described as stuck

The Middle East risk

The same report named a prolonged or more intense Middle East conflict as the biggest risk to Pakistan's near-term outlook, because Pakistan relies heavily on imported energy. Petroleum and gas products made up about one-quarter of total imports in FY25, and Gulf Cooperation Council countries supplied around 80 percent of those energy imports, the report said.

Source: World Bank report via 10bmnews

Pakistan's petroleum imports rose 9.2 percent year on year in January–June 2026 while its crude oil import bill jumped 46.4 percent over the same period, the report said — a sign that higher prices, not just higher volumes, are driving the bill. A longer conflict could keep energy prices high, widen the current account deficit and strain foreign exchange reserves, the World Bank warned.

Separately, the bank's baseline put FY27 growth at 3.8 percent, and it warned a stronger-than-expected El Nino could cut that to 3.6 percent if crop output showed zero growth — a conditional scenario in the report, not its baseline forecast.

Why it matters beyond Pakistan

Pakistan imports most of its energy from the Gulf, where lakhs of South Asian workers also live and send remittances home. Energy prices and Gulf stability therefore reach household budgets across the region, including in Punjab.