Islamabad : The Pakistan Bureau of Statistics (PBS) recently released the Quarterly National Accounts (QNA) data for Q3 of FY 2025 on both the Production and Expenditure sides, alongside the Annual National Accounts. The updated data provides insights into the evolving structure of
GDP by expenditure components.
Table 2: Growth Rate Comparison FY 2024 & FY 2025* (%) Description
FY 2024 FY 2025 –Q1 Q2 Q3 Q1 Q2 Q3
Household final consumption expenditur 6.3 5.3 5.9 2.4 1.5 (0.2)
NPISH final consumption expenditure 3.4 0.3 1.7 12.1 14.9 16.0General government final consumption expenditure (4.9) 1.4 (17.1) 10.3 4.3 40.4
Gross fixed capital formation (6.2) (5.1) 2.3 1.4 10.1 23.2
Changes in inventories 3.7 1.3 1.5 4.6 5.3 6.3
Valuables 3.7 1.3 1.5 4.6 5.3 6.3
Exports of goods and non-factor services (1.1) (0.7) (4.8) (5.8) 0.6 4.1
Less imports of goods and non-factor services 9.2 8.9 2.9 2.9 2.2 9.7
GDP by expenditure 2.8 2.4 2.8 2.0 2.6 3.5
:
QGDP Expenditure at Constant Prices
Source: Pakistan Bureau of Statistics
In FY 2024, growth was primarily driven by household consumption, which remained robustacross Q1-Q3 (5.3%-6.3%), while government consumption was volatile, especially in Q3 (-17.1%). Gross fixed capital formation showedweak performance in Q1 and Q2 but recovered
to 2.3 percent in Q3. Exports growth remained negative throughout, while imports grew strongly, especially in Q1 and Q2, supporting GDP.
In contrast, FY 2025 shows a shift in growth composition. Household consumption growth weakened significantly, turning negative in Q3
(-0.2%), while NPISH and government
consumption surged, particularly in Q3 (16.0% and 40.4%, respectively), indicating greater reliance on public and nonprofit sector spending.
Investment showed strong recovery, with gross fixed capital formation accelerating from 1.4 percent in Q1 to 23.2 percent in Q3. Exports also
improved gradually, turning positive by Q3 (4.1%), while import growth moderated. As a result, overall GDP growth in FY 2025 improved steadily each quarter, peaking at 3.5 percent in
Q3, compared to a flatter trend in the previous year. Several key factors supported this growth.
In Q1, easing monetary policy by the SBP, reducing the policy rate by 1100 basis points, stimulated private sector investment. The credit to the Private sector increased from Rs 307.8
billion to Rs 830.9 billion, showing a growth of 169.9 percent during July-March FY 2025. In contrast, the Private sector credit to manufacturing witnessed extraordinary growth of 72.4 percent, with working capital loans expanding from Rs 286.1 billion to Rs 493.1
billion. Subsequent quarters benefited from improved business sentiment, better project implementation under the PSDP, and stability in input costs.
Additionally, a pickup in construction and industrial activities, alongside
stronger public sector development spending, further boosted capital formation.
Concluding Remarks : –
With PBS already compiling Quarterly National Accounts (QNA) from the production side, the addition of expenditure-side QNA provides a
more comprehensive understanding of economic dynamics. While the production side captures the supply of goods and services, the expenditure side offers insights into the demand drivers:
consumption, investment, government spending, and net exports.
