Pakistan can triple incomes by 2050 with faster reforms: World Bank

The World Bank has stated that Pakistan could potentially triple its incomes by 2050 if the country implements faster structural reforms, according to its latest Pakistan Development Update: Attaining Escape Velocity. Following successful macroeconomic stabilisation, Pakistan now stands at the threshold to achieve faster and sustained economic growth and job creation, the global lender revealed on Thursday.

The bank highlighted that robust macroeconomic policies over the past few years have helped stabilize the economy and maintain growth, even amidst the disruptions caused by the Middle East conflict. Real GDP growth rose to 3.7% in FY26 from 3.2% in FY25, while primary fiscal surpluses reached 2.9% of GDP, driven by revenue growth and expenditure restraint.

Additionally, strong remittances enabled the re-accumulation of foreign exchange reserves. These achievements were acknowledged by two major international rating agencies (S&P and Moody’s), leading to Pakistan's return to international debt markets through the issuance of a US$3 billion Eurobond. Bolormaa Amgaabazar, World Bank Country Director for Pakistan, noted that while Pakistan has made significant strides in restoring stability, real per capita growth, which reflects the income growth of an average Pakistani, remains stagnant at around 1.6%.

The report emphasized that to achieve faster growth, Pakistan must pursue ambitious economic reforms similar to those implemented by other successful countries. According to the report, if Pakistan follows such a path, it could attain a growth rate of 6.2-6.9% annually, enough to elevate its per capita income to the level of Vietnam by 2050.

Currently, structural reforms aimed at encouraging private investment are essential for achieving higher living standards, as fiscal resources and foreign exchange remain constrained. The report proposed a suite of ambitious reforms to help Pakistan reach the per capita income levels of upper-middle-income countries by 2050. These reforms include timely power sector tariff adjustments, continued trade liberalization under the National Tariff Policy, and the privatization of Pakistan International Airlines.

To achieve sustained progress, the World Bank stressed the need for ongoing reforms to improve the business environment, tax system, reduce the state's presence in the economy, and expand access to finance.