Pakistan inflation to clock in at over 5% in Oct led by higher food prices — report

A man and workers are seen at a spice and grocery shop in a market in Karachi, Pakistan, on June 10, 2025. (REUTERS/File)
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Updated 28 October 2025
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Pakistan inflation to clock in at over 5% in Oct led by higher food prices — report

  • Key contributors to the food inflation are tomatoes (+27 percent), fresh vegetables (+25 percent), and onions (+10 percent)
  • A shift in global commodity prices remains a major variable that can alter inflation trajectory, it says

ISLAMABAD: Pakistan’s headline inflation, measured by the Consumer Price Index (CPI), is expected to reach 5.25–5.75% in October year on year, a market research firm said on Tuesday.

This is in comparison with 5.61% inflation in Sept. 2025 and 7.17% in Oct. 2024, according to Karachi-based Topline Securities. On a month-on-month basis, inflation for Oct. 2025 is projected at +1.1 percent.

“Food segment is expected to show increase of 1.21% MoM,” the brokerage and research firm said on Tuesday. “The resurgence in food inflation is primarily on the back of supply side effect on food products due to floods and closure of Afghan Border in the country.”

The frontier was closed after days of cross-border strikes and skirmishes between the two countries, which began on Oct. 11, over a surge in militancy in Pakistan’s western regions that border Afghanistan.

Key contributors to food inflation are tomatoes (+27 percent), fresh vegetables (+25 percent), and onions (+10 percent), though fresh fruit and chicken are down 10% and 25 percent, respectively, according to the report.

The transport segment is expected to rise by 1.12% MoM, mainly due to a 2.1% rise in motor fuels, with petrol rising 1.7% and high-speed diesel (HSD) rising 2.5 percent.

In Pakistan, inflation has fallen sharply from a record 37.97% in May 2023, when global commodity shocks, energy price hikes and currency depreciation sent prices soaring.

By late 2024 and early 2025, headline inflation had fallen into single digits on monthly measures, aided by tight monetary policy, base effects and external stabilization efforts.

“With inflation expectations of 5.25-5.75% for Oct. 2025, real rates will surge to 525-575bps, higher than Pakistan’s historic average of 200-300bps,” the report read.

“A significant shift in global commodity prices remains a major variable that could alter the inflation trajectory moving forward.”


Pakistan to invest $1 billion in AI by 2030 in push to modernize economy

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Pakistan to invest $1 billion in AI by 2030 in push to modernize economy

  • PM says government will introduce AI curriculum in schools nationwide
  • The transformation plan will help train 1 million non-IT professionals in AI

ISLAMABAD: Prime Minister Shehbaz Sharif on Monday announced that Pakistan would invest $1 billion in artificial intelligence (AI) by 2030, in a major step to modernize the South Asian nation’s digital economy.

Pakistan, a country of 240 million people, seeks to become a key participant in the global AI economy, amid growing interest from governments in the Global South to harness AI for productivity, skills development and innovation.

The South Asian nation has been actively developing its AI landscape and approved its National AI Policy in July last year, which was followed by the launch of the country’s sovereign AI cloud and a startup fund.

Speaking at the launch of the Indus AI Week 2026 in Islamabad, Sharif unveiled a multi-pronged roadmap intended to transform Pakistan from a provider of IT technicians into a global hub for AI expertise.

“I am pleased to announce that the Government of Pakistan is committed to invest $1 billion in AI by 2030, which will go a long way in building AI ecosystem in our country,” he told policymakers and international tech experts at Islamabad’s Jinnah Convention Center.

Sharif detailed several flagship initiatives to support this transformation, including a sweeping educational reform, at the event organized by the Information Technology (IT) Ministry, which will be running until Feb. 15, featuring strategic dialogues on sovereign AI and technical showcases.

“AI curriculum will be introduced not only in all federally controlled or run schools, but also in all schools of AJK, that is Azad Jammu and Kashmir, and Gilgit-Baltistan, as well as remote parts of Balochistan,” he said.

The government will provide 1,000 fully funded PhD scholarships in AI to postgraduates to bolster high-level research, according to the PM. It plans to launch a nationwide program to train 1 million “non-IT professionals in AI skills” to enhance productivity and improve livelihoods across traditional sectors of the economy.

Sharif emphasized that the focus would remain on high-impact sectors, including agriculture, mines and minerals, and the empowerment of Pakistan’s youth which makes up 60 percent of its 240 million population.

“We will, God willing, bring in programs to transform them from IT technicians to AI experts, which will lead to our agriculture production in terms of its yield, its quality, its efficiency, like never before,” he said.

Drawing parallels to previous digitization efforts in the Punjab province, such as land record digitization and the establishment of the first IT university in Lahore, Sharif framed the AI push as a “gamechanger” for national governance. He noted the Federal Board of Revenue is already undergoing a digital overhaul to curb smuggling and tax evasion.

“Pakistan is absolutely ready to accept the challenge and walk with our global partners absolutely with great commitment and dedication,” he said. “Our commitment is solid, unwavering. We will never look back.”