Does Pakistan's Real GDP Exceed One Trillion US Dollars?

by Riaz Haq

Jun 19

A 2024 joint study of the International Labor Organization and the Small and Medium Enterprise Development Authority  (SMEDA) estimated Pakistan's undocumented economy at $457 billion. While other South Asian nations, particularly Bangladesh and India, do include estimated undocumented GDP figures in their official GDP, Pakistan's official GDP figures do not include such estimates. If the Pakistani government decides to include estimates of the informal economy in its official figures, the country's GDP would jump to $1,059  billion in market exchange terms and over $4,000 billion in PPP terms. 

Pakistan's Total GDP, including Undocumented, Estimated at over $1 Trillion


In 2023 when the ILO-SMEDA study was conducted, Pakistan's official GDP was $340 billion (34% less than the undocumented GDP), bringing the total real GDP for 2023 to $797 billion. Pakistan's official GDP figure for 2025-26 is projected to be $452 billion. Assuming that the undocumented GDP has grown at the same rate as the official GDP, the undocumented GDP today works out to $607 billion, bringing the total GDP (documented and undocumented) to over $1 trillion. In terms of purchasing power parity, the total national economy, including the informal economy, is estimated to be over $4 trillion, which translates to over $16,000 per capita. 

Being the largest employer, Pakistan's undocumented sector acts as a critical shock absorber for the labor force and sustains millions of low-income households. But it also restricts the government tax collection which could be invested in education, healthcare and infrastructure development. There is a temptation in Pakistan to force documentation of the entire economy as the Indian government has attempted to do. However, it will create a mass unemployment problem as many small businesses would be forced to close. 
India is an example of what can go wrong in attempting to bring the informal sector into the tax net too quickly. Demonetization and GST taxes together have decimated the informal sector. But the Indian government continues to significantly overestimate its annual economic growth, particularly by misjudging the size and trajectory of the country's informal (undocumented) sector.  Because of these estimation errors, researchers, including India's former Chief Economic Adviser Arvind Subramanian, estimate that the absolute level of India's real GDP may be overstated by 22% to 31%. This implies the average citizen's actual standard of living is lower than official data suggests. 
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  • Riaz Haq

    Can Technology And Skills Change Pakistan’s Growth Story? – OpEd
    July 2, 2026 0 Comments
    By Ali Mehar


    https://www.eurasiareview.com/02072026-can-technology-and-skills-ch...


    Pakistan’s future will not be decided just by the size of its problems, only by how seriously it turns its strengths into national power. For decades, the country has been described through crisis, debt, energy shortages, climate vulnerability, weak productivity, and governance gaps. These challenges are still real and they cannot be wished away. However, there is another Pakistan showing up too: younger, more connected, more entrepreneurial, more digitally aware and increasingly mindful about sustainable development. The real chance now is to match this human energy with technology, clean power and modern farming practices.

    Pakistan’s demographic picture gives it this kind of unusual, quiet advantage. Over 60 percent of Pakistan’s people are below age 30. That “youth bulge” can turn into a drag, if they’re left without work and without proper training. Or it can be, sort of the most reliable engine of growth, if they’re given practical know-how and tied into global markets. With more than 100 million internet users, Pakistan already has the basic digital floor to widen online work, technology exports, e-commerce, remote services, and even new kinds of digital entrepreneurship. So the mission is not really to argue that Pakistan has talent. The real challenge is organizing that talent into something like a productive economic force.

    The rise of IT and freelancing basically shows what can happen when young Pakistanis get connected to opportunity. Technology exports hovering around US$4.2 billion during the first eleven months of fiscal year 2025–26 signals a big change in how the economy is moving. And IT exports aren’t only a few figures sitting on a balance sheet. They’re the software houses, startups, coders, designers, AI specialists, cloud engineers, and business process professionals earning income from international clients. In a country that’s often under strain due to foreign exchange shortages, every dollar made through knowledge-driven exports helps reinforce economic resilience.

    Freelancing has become this more visible sign of the whole transformation, like you can actually see it now. Pakistani freelancers bringing in roughly US$1.6 billion during the first eleven months of FY2025–26 suggests that the digital economy is cracking open doors beyond the usual job arrangement. This matters, a lot, for a country where government-sector positions are limited and the private sector still does not take in enough people. Freelancing lets young folks monetize abilities from homes, small towns, universities and co working spaces, sort of in a low barrier way. It also gives women and students a flexible route toward income, especially when movement is hard, social barriers are real, or local hiring is just not there.

    Jul 3

  • Riaz Haq

    The following is a fintech and wider digital economic development view of the South Asian nation of Pakistan in 2026.

    By Richie Santosdiaz

    https://thefintechtimes.com/fintech-landscape-of-pakistan-in-2026/

    Pakistan’s fintech story cannot be separated from the country’s wider economic challenges. For years, Pakistan has faced recurring balance-of-payments pressures, high inflation, currency volatility, fiscal constraints and the difficult task of expanding formal economic participation across a population of more than 240 million people. These structural pressures have shaped almost every part of the economy, including financial services.

    That is why fintech in Pakistan matters. It is not simply about digital wallets, payment apps or startup valuations. It is about whether technology can help make one of South Asia’s largest economies more efficient, more inclusive and more formalised.

    “Is Fintech the Key to Economic Revival in Pakistan?”was written by me and it highlighted how fintech could support financial inclusion, digital payments, small and medium enterprise (SME) finance, remittances and broader economic recovery. That argument remains highly relevant today, particularly as Pakistan continues trying to move more economic activity into formal and digital channels.

    Pakistan’s economic scale is significant. Pakistan’s gross domestic product (GDP) stood at around $371.6billion in 2024, while GDP per capita was approximately shy of $1,500. The economy is supported by agriculture, textiles, manufacturing, services, remittances, construction, telecommunications and a large informal sector, all according to the World Bank. Karachi remains the country’s financial centre, Lahore is a major commercial and technology hub, and Islamabad serves as the political and regulatory capital.

    Yet Pakistan’s biggest fintech opportunity may lie outside its formal banking system. Millions of people remain underbanked or financially excluded. The World Bank’s Global Findex Database continues to highlight the importance of account ownership, digital payments and mobile-enabled finance in expanding financial inclusion globally. In Pakistan, the gap between population size and formal financial usage remains one of the most important development challenges facing the sector.

    This is where digital finance can have an outsized impact. A bank branch-based model alone cannot serve Pakistan’s entire population efficiently. Geography, income levels, informality and documentation barriers all limit traditional banking reach. Digital wallets, agent networks, mobile accounts and instant payments therefore offer a more scalable path to inclusion.

    Payments are the clearest example. Pakistan has spent the past several years building the foundations for a more digital payments economy. The State Bank of Pakistan’s Raast Instant Payment System has become one of the country’s flagship financial infrastructure initiatives, designed to enable low-cost, real-time digital payments between individuals, businesses and government entities. The creation of Raast Payments Pakistan Pvt. Ltd. further signals the central bank’s ambition to institutionalise and expand the country’s digital payments infrastructure.

    This infrastructure matters because payments sit at the heart of formalisation.

    When salaries, merchant transactions, remittances, utility bills and government payments move digitally, they create records. Those records can support credit scoring, taxation, consumer protection and better financial planning. In a country where cash and informality remain deeply embedded, digital payments can gradually change the structure of economic participation.

    Jul 10

  • Riaz Haq

    Pakistan Sees Sudden 6x Jump in Credit Card ATM Transactions
    By Business Desk | Published Jul 26, 2026 | 8:06 pm

    https://propakistani.pk/2026/07/26/pakistan-sees-sudden-6x-jump-in-...

    Pakistan’s credit card market recorded its largest-ever quarterly growth, with the number of cards in circulation jumping by 900,000 in just three months, according to Gallup Pakistan’s Digital Analytics Dashboard based on data from the State Bank of Pakistan (SBP).

    The total number of credit cards increased from 2.2 million in FY25 to 3.1 million in Q1 FY26 (July-September 2025), up by 44 percent.

    The addition exceeds the total net growth recorded over the previous six years, during which the credit card base rose from 1.6 million to 2.2 million.

    The surge coincided with a sharp rise in credit card usage. SBP data shows the value of credit card transactions at ATMs increased nearly sixfold during the same quarter.

    Despite the unprecedented jump, no major bank, fintech, or financial institution publicly announced a large-scale credit card issuance campaign during the period.

    The increase could be linked to a major card issuance, a regulatory reclassification of certain card products, or the launch of new credit-based payment products. SBP hasn’t revealed anything on this so far.

    Debit cards continue to dominate Pakistan’s payment landscape, accounting for around 90% of the country’s 61.3 million payment cards, while credit cards represent about 4 percent.

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    Credit card growth in Pakistan is experiencing a sudden shift, jumping from a stagnant base of 2.2 million to 3.1 million cards in late 2025, driven by rising fintech adoption and digital banking integrations. Despite this growth, total penetration remains exceptionally low relative to the country's population. [1, 2, 3, 4]
    Market Statistics and Recent Surge
    Base Expansion: Stagnated around 1.6 million to 2.2 million cards between FY20 and FY25, before a single-quarter jump to 3.1 million in Q1 FY26 (July–September 2025). [1]
    Transaction Activity: ATM credit card transaction values spiked nearly 6x during the Q1 FY26 surge, confirming active utilization rather than passive issuance. [1]
    Overall Market Share: Debit cards still heavily dominate, making up roughly 90% of Pakistan’s 61.3 million total payment cards. [1]

    Jul 26