Low savings hamper growth: SBP chief

Pakistan’s domestic savings have dropped to just 7.4 per cent of GDP — far below the regional average of 27pc — creating chronic reliance on external financing and contributing to recurring economic boom-bust cycles, said State Bank Governor Jameel Ahmed on Monday. Speaking at the conference ‘Unlocking the Capital Markets Potential for Banks’, Mr Ahmed said the country’s low savings rate, coupled with declining investment, has constrained long-term growth prospects. According to the Pakistan Bureau of Statistics, private investment has declined from nearly 12pc of GDP in 2008-09 to just 9pc in 2024-25. Public investment has also fallen sharply, from 4pc to 2.9pc of GDP over the same period. Pakistan ranks the lowest in the region in terms of total investment. World Bank data shows gross fixed capital formation in Pakistan at 12pc of GDP, compared to 20pc in Sri Lanka and over 31pc in Bangladesh.