Islamabad, Feb 7 (IANS): Pakistan's economy would grow at four percent during the current fiscal year (2011-12), Finance Minister Abdul Hafeez Shaikh has said.

"Despite challenges, the GDP growth would reach to four percent this year," the minister said while addressing a session of Pakistan-Iran Bilateral Economic meeting here Monday.

Shaikh said that at a time when the world economy is passing through recession, the economy of Pakistan has been showing positive signs towards growth, reported Associated Press of Pakistan.

He said the country's exports have crossed the $25 billion figure last year and are likely to grow more this year while the remittances were also on rise and the revenue targets set for the fiscal year were well within reach.

Despite all this, Pakistan was facing challenges like shortage of energy, Shaikh said.

Commenting on Pakistan-Iran relations, he said the trade relations between the two countries were not up to the potential between the countries.

He said bilateral trade between the two counties was just $1.5 billion.

The minister said that there was need to eliminate tariff and non-tariff barriers and provide incentives to the private sector for trade development.

He added that the work on Iran-Pakistan Gas Pipeline Project would be intensified.