Pakistan, June 16 -- Finance Minister Muhammad Aurangzeb said there was significant upside potential for Pakistan's economic growth, inflation, foreign exchange reserves and interest rates in FY2026-27, provided the country does not have to contend with the second- and third-order effects of the conflict in the Middle East.

"For the next year, we have the GDP growth number at 4% and inflation at 8.2%. I see upside in both numbers if we don't have to deal with second- and third-order impacts [of the ongoing conflict]," he told Bloomberg News on Monday.

Pakistan on Friday unveiled an Rs18.77 trillion federal budget for the fiscal year 2026-27, with the economy expected to grow 4% in 2026-27, and average inflation is expected to be recorde...