ISLAMABAD: Pakistan is expected to earmark approximately Rs1.126 trillion for development spending in the upcoming Federal Budget 2026–27, with infrastructure, energy and social sector projects likely to receive major allocations, according to Planning Commission documents reviewed during a high-level policy meeting.
The proposed framework was discussed during an annual coordination meeting chaired by Minister for Planning and Development Ahsan Iqbal, where officials reviewed development priorities and economic targets for the next fiscal year.
Under the preliminary plan, key allocations under consideration include approximately Rs408 billion for transport and communications, Rs140 billion for water resources, Rs135 billion for energy projects, and around Rs187 billion for social sector development initiatives.
The government is also reportedly considering a 4% GDP growth target for FY2026–27, with sectoral projections including 3.6% growth in major crops, 5.8% in manufacturing, and 4% overall industrial growth.
Officials noted that economic performance in the outgoing fiscal year remained below expectations, with overall GDP growth estimated at 3.7%, missing earlier targets despite projected improvement in large-scale manufacturing output.
Speaking after the meeting, Planning Minister Ahsan Iqbal said Pakistan would require nearly Rs10 trillion to complete ongoing development schemes nationwide, underscoring the challenge of financing long-term infrastructure commitments amid fiscal constraints. He noted that development spending has declined significantly over recent years while debt servicing continues to consume a major share of federal resources.
According to officials, projects worth nearly Rs5 trillion are currently under implementation, while proposals valued at around Rs720 billion for new initiatives are also under review.
The proposed development outlay comes as Islamabad prepares its next budget amid ongoing economic reforms, revenue pressures and efforts to balance growth ambitions with limited fiscal space.