New Delhi, Jan 5 : Pakistan's official figures citing 3.7 per cent economic growth in Q1 FY26 is likely an accounting illusion on paper rather than real increases in production or exports, a report has said.

A report from Express Tribune cited the think tank Economic Policy and Business Development's (EPBD) view that the growth approved by the National Accounts Committee (NAC) reflects "methodological artefacts, deflator manipulation and import-led assembly activity," instead of real gains in productive capacity.

The forum called the data an attempt at an illusion of recovery while business activity, manufacturing output and exports remain under pressure.

Primarily, the official headline figure of 9.4 per cent industrial growth, largely stemmed from accounting adjustments, the think tank said. Electricity, gas and water supply was recorded as having grown 25 per cent growth, but it was fuelled by subsidies jumping from Pakistani Rupees (PKR) 20 billion to PKR 118 billion, rather than higher output, it said.

Construction mentioned to have grown 21 per cent is unlikely as cement production rose by only 15 per cent, while transport-related imports more than doubled, including an extraordinary spike in bus and truck imports, it added.

Food exports fell sharply by 25.8 per cent during Q1FY26, while food imports surged by 18.8 per cent, yet agriculture and food manufacturing were reported to have expanded. Agriculture, it said, grew 2.9 per cent despite flood impacts, stagnant crop output and the absence of a wheat harvest during the quarter.

EPBD pointed to big gaps between domestic growth claims and trade indicators. The report said that imports rose 11 per cent in the first half of the year, while exports declined around 9 per cent, reinforcing concerns that the economy lacks sustainable, private-sector-led growth.

Cotton production declined, ginning dropped by over 12 per cent, and cotton-based exports fell around 10 per cent, it noted.

/IANS