Pakistan’s Services Exports Surge by 17.38% in 11 Months of FY 2026

ISLAMABAD — Pakistan’s services exports experienced a significant growth of 17.38% during the first eleven months of the fiscal year 2025-26, as reported by the Pakistan Bureau of Statistics (PBS). From July 2025 to May 2026, the country earned $9.097 billion from services exports, compared to $7.750 billion in the same period of the previous fiscal year.

What Happened

The latest data from PBS highlights a robust performance in Pakistan’s services sector, with exports increasing by 17.38% over the first eleven months of FY 2026. This growth is reflected in the earnings of $9.097 billion, a notable rise from the $7.750 billion recorded during the same period in FY 2025. Concurrently, services imports also rose by 8.64%, reaching $11.099 billion, up from $10.338 billion in the previous fiscal year.

The services trade deficit showed a marked improvement, contracting by 24.10% to $2.002 billion from $2.638 billion in the corresponding period of the last fiscal year. On a year-on-year basis, the services trade deficit in May 2026 decreased significantly by 118.03% compared to May 2025. In May 2026 alone, service exports grew by 15.99%, amounting to $838.28 million, up from $722.74 million in May 2025.

Moreover, services imports in May 2026 decreased by 9.41%, recorded at $807.82 million, compared to $891.69 million in the same month of the previous year. On a month-on-month basis, the services trade deficit narrowed by 8.63% in May 2026, recorded at $30.46 million, compared to $33.34 million in April 2026. However, service exports in May 2026 slightly decreased from April 2026’s $904.09 million to $838.28 million.

Background

Pakistan’s services sector has been a critical component of the national economy, contributing significantly to GDP and employment. Historically, the sector has faced challenges, including a trade deficit, which the government has been working to address through various policy measures aimed at boosting exports and reducing imports. The recent growth in services exports indicates a positive trend, reflecting the effectiveness of these measures and the resilience of the sector.

The services sector encompasses a wide range of activities, including finance, insurance, transportation, and information technology, all of which have shown potential for growth. The government has been focusing on enhancing the competitiveness of these services in international markets, which is crucial for sustaining economic growth.

Why It Matters

The growth in services exports is significant for Pakistan’s economy, as it helps reduce the overall trade deficit and contributes to foreign exchange earnings. A reduced trade deficit can lead to improved fiscal stability, which is vital for economic planning and development. The increase in services exports also indicates a diversification of Pakistan’s export base, traditionally dominated by textiles and agriculture.

Economically, the growth in the services sector can lead to job creation, increased investment, and technological advancements, all of which are essential for long-term economic development. Socially, it can improve living standards by providing better employment opportunities and services to the population.

Internationally, a strong services sector enhances Pakistan’s economic standing and competitiveness, potentially attracting foreign investment and partnerships. This growth aligns with global economic trends where services play a crucial role in economic development, and positions Pakistan to benefit from global trade dynamics.

Key Takeaways

Services exports in Pakistan grew by 17.38% in the first eleven months of FY 2026.
The services trade deficit contracted by 24.10% during the same period.
May 2026 saw a year-on-year services export increase of 15.99%.
Services imports decreased by 9.41% in May 2026 compared to May 2025.
Growth in services exports contributes to reducing the overall trade deficit and enhancing economic stability.