Pakistan’s development spending exceeds revised budget by Rs92bn

Federal development spending reached Rs912 billion in fiscal year 2025-26.

The amount exceeds the government's downward revised Public Sector Development Programme allocation of Rs820 billion by Rs92 billion. 

The revised allocation had been reduced by around 18% as the government sought to meet the International Monetary Fund's primary budget surplus target.

Officials said spending surged in the final days of the fiscal year after additional expenditures were booked by several ministries.

Around Rs382 billion of the total development spending was recorded in the last month alone.

The Power Division spent Rs122 billion despite a revised allocation of Rs73 billion, while the Water Resources Division recorded Rs137 billion in spending against a revised budget of Rs102 billion. 

In contrast, the National Highway Authority remained within its revised allocation of Rs182 billion after facing one of the largest budget cuts. Foreign-funded development projects also contributed significantly, with Rs244 billion, or 26% of total PSDP spending, financed through external loans.

Despite overshooting the revised allocation, total federal development spending remained below the Rs1.1 trillion spent in the previous fiscal year. 

The government has also acknowledged that over Rs11 trillion is required to complete ongoing development projects, while large infrastructure schemes continue to face funding shortages and rising costs.