Pakistan Development Budget 2024: Prioritized Projects | Ahsan Iqbal
- Faced with fiscal constraints, the Pakistani government will prioritize high-value projects in its upcoming budget.
- The move aligns with austerity measures demanded by the International Monetary Fund (IMF) as part of its $7 billion loan program.
- Speaking in Islamabad, Iqbal noted the development budget's decrease since 2023.
Pakistan’s 2025-26 progress budget, as announced by Ahsan Iqbal, prioritizes high-value projects amidst fiscal constraints. The government will allocate Rs880 billion, focusing on infrastructure, energy, and strategic advancements to spur economic growth, despite IMF-mandated austerity measures aimed at reducing the budget deficit.With a strong emphasis on fiscal discipline and increased tax collection, the plan aims for a 4.2% GDP growth, with notable investments in key sectors and provinces. News Directory 3 keeps you informed about the evolving financial landscape. Discover what’s next for Pakistan’s economic development.
pakistan Prioritizes High-Value Projects Amid Budget constraints
Updated June 02, 2025
Faced with fiscal constraints, the Pakistani government will prioritize high-value projects in its upcoming budget. Federal Minister for Planning, Development, and Special Initiatives Ahsan Iqbal announced that only Rs880 billion has been allocated for development in the fiscal year 2025-26.
The move aligns with austerity measures demanded by the International Monetary Fund (IMF) as part of its $7 billion loan program. These measures aim to reduce the budget deficit and improve debt sustainability through stricter spending policies and increased revenues. the IMF projects Pakistan to achieve 3.6% economic growth with 7.7% inflation next year.
Speaking in Islamabad, Iqbal noted the development budget’s decrease since 2023. He emphasized the need for “tight financial discipline” to balance spending and income, a strategy agreed upon with the IMF. Limited resources necessitate a focus on high-priority projects for national development and ensuring “value for money” in project selection.
Iqbal highlighted that Rs664 billion of the development budget will be allocated to infrastructure projects,including energy,water,transport,and planning. Prime Minister Shehbaz Sharif has directed Rs120 billion to upgrade the N-25 Highway in Balochistan into an expressway. Special areas like Azad Jammu and Kashmir (AJK) and Gilgit-Baltistan will receive Rs63 billion, while merged districts in Khyber-Pakhtunkhwa will get Rs70 billion.
Science and IT will receive Rs53 billion, institutional reform bodies Rs9 billion, and the production sector Rs11 billion. The government’s guiding principle is to prioritize projects with available rupee cover and foreign funding, protecting those of national importance and advancing projects nearing completion. The government aims to move away from token allocations to ensure projects remain viable.
Iqbal outlined the government’s annual plan, projecting a 4.2% GDP growth,with 4.5% from agriculture, 4.3% from industry, and 4% from services. the country has set export targets of $35 billion and foreign remittances of $39 billion.He thanked overseas Pakistanis for their continued remittances, calling it “like oxygen” to the country.
The planning minister stressed the need for increased tax collection, stating that Pakistan has one of the lowest tax-to-GDP ratios globally. He urged citizens to cooperate against tax evasion,emphasizing that tax reforms are a national security priority.The government plans to hand over provincial development projects to provincial governments, focusing on projects managed by the federal government.
“As resources are limited, we need to focus on high-priority projects for national development. We need to ensure ‘value for money’ in selecting projects,” Iqbal said.
What’s next
The government will focus on increasing tax collection and ensuring efficient allocation of resources to meet its development goals. Prioritizing key infrastructure projects and strategic initiatives will be crucial for achieving sustainable economic growth.