Pakistan's per capita income can triple by 2050 with fast-track implementation of structural reforms, World Bank

Pakistan has made real progress in restoring economic stability, economic indicators have improved, World Bank Group

World Bank Group has said that through fast-track implementation of structural reforms, Pakistan's per capita income can triple by 2050, Pakistan has made real progress in restoring economic stability, economic indicators have improved.

This was said in Pakistan Development Update report released by World Bank on Thursday.

According to report, after progress in achieving economic stability, Pakistan has got important opportunity to create fast-paced and sustainable economic growth and employment opportunities, during last few years stable economic policies helped in stabilizing economy and maintaining continuity of growth, however effects of Middle East conflict have also impacted economy.

Report stated that real GDP growth rate increased to 3.7 percent in fiscal year 2026, which was 3.2 percent in fiscal year 2025, as result of measures to increase revenues and control expenditures, primary fiscal surplus reached record 2.9 percent of GDP in fiscal year 2026, increase in remittances helped in rebuilding foreign exchange reserves.

According to report, in recognition of these economic improvements, two major credit rating agencies S&P and Moody's improved Pakistan's rating while issuance of 3 billion dollars Eurobonds made Pakistan's return to global debt market possible.

World Bank Country Director in Pakistan Bolormaa Amgaabazar said that Pakistan has made real progress in restoring economic stability and global markets have also recognized it, however growth rate of real per capita income is still limited to about 1.6 percent. She said that immediate implementation of reforms is indispensable to accelerate economic growth. Report said that if Pakistan adopts broad-based and effective economic reforms like other successful countries, sustainable economic growth annual rate can reach 6.2 to 6.9 percent.

At this pace, Pakistan can achieve Vietnam's current per capita income level by 2050. Central author of report Sebastian Essl said that despite achieving economic stability, availability of financial resources and foreign exchange remains limited, therefore structural reforms encouraging private investment are next necessary step to raise living standard of people.

Comprehensive planning, effective coordination between institutions and implementation with continuous commitment on reforms is necessary for private sector-led economic growth.

Report identifies such comprehensive reforms through which Pakistan can achieve per capita income level of those countries by 2050 which are currently included in upper middle income countries bracket.

Many of these reforms are already underway, including timely tariff adjustment in energy sector, continuation of trade liberalization under National Tariff Policy and recent privatization of Pakistan International Airlines.

Report stated that as result of timely adjustment of tariff in energy sector, energy subsidies decreased from 1.1 percent of GDP in fiscal year 2025 to 0.8 percent in fiscal year 2026, however to maintain benefits of these measures and accelerate pace of growth, continuous progress is necessary to improve business environment, reform tax system, limit state role in economy and increase access to financial resources.