Pakistan Likely To Set Aside Rs1.126 Trillion For Development Projects In Budget 2026-27
- Federal development spending is expected to reach Rs1,126 billion in the upcoming budget.
- Transport, communications, energy, water, and social sectors are set to receive major allocations.
- Government has proposed a 4% GDP growth target for the next fiscal year.
Pakistan is expected to allocate around Rs1,126 billion for development projects in the federal budget for fiscal year 2026-27, as the government seeks to accelerate economic growth and complete ongoing infrastructure and public welfare initiatives.
According to Planning Commission documents reviewed during an annual meeting of the coordination committee, several key sectors are expected to receive significant funding under the proposed development programme.
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The documents show that around Rs408 billion has been proposed for transport and communications projects, making it the largest sectoral allocation under consideration. The government is also considering allocating Rs187 billion for the social sector, Rs140 billion for water resources projects, and Rs135 billion for energy-related schemes.
Alongside development spending plans, the government has proposed a gross domestic product (GDP) growth target of 4 percent for the next fiscal year. Sector-specific targets include 3.6 percent growth in major crops, 5.8 percent growth in manufacturing, and 4 percent growth in the overall industrial sector.
The Planning Commission noted that the country’s GDP growth during the current fiscal year was recorded at 3.7 percent, falling slightly below the target set by the government. Large-scale manufacturing growth is projected at 4.5 percent.
Planning and Development Minister Ahsan Iqbal reviewed the proposals during the meeting and later highlighted the challenges facing the country’s development agenda.
Speaking to reporters, he said Pakistan would require nearly Rs10 trillion to complete all ongoing development projects across the country. He stressed the need to increase development resources to avoid delays and ensure timely project completion.
The minister noted that development spending has remained largely stagnant over the past eight years, affecting the pace of several projects. He said development investment has declined from 2.6 percent of GDP to just 0.6 percent, while allocations after 2018 continued to show a downward trend.
Ahsan Iqbal further revealed that projects worth approximately Rs5 trillion are currently under implementation nationwide. In addition, new project proposals worth around Rs720 billion are also being considered for inclusion in future development plans.
He emphasized that completing ongoing projects remains one of the government’s top priorities. However, he noted that a substantial portion of the federal budget is currently consumed by debt servicing obligations, limiting the fiscal space available for development spending.
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