Annual Budget Statement
The Annual Budget Statement is part of the federal budget for FY 2026-27. This page reproduces the text of its 57 PDF pages, extracted automatically from the official PDF published by the Finance Division, Government of Pakistan.
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Page 1
FEDERAL BUDGET
2 0 2 - 2 6 7
ANNUAL
BUDGET
STATEMENT
GOVERNMENT OF PAKISTAN
FINANCE DIVISION
ISLAMABADPage 2
No text layer on this page, see the official PDF.
Page 3
PREFACE
Annual Budget Statement for FY2026-27 is presented to the National
Assembly in accordance with Article 80(1) of the Constitution of the Islamic
Republic of Pakistan, which requires the Federal Government to lay before the House
a statement of estimated receipts and expenditures for each financial year. In
accordance with Article 80(2), the statement separately reflects charged and voted
expenditures from the Federal Consolidated Fund and distinguishes expenditure on
revenue account from other expenditures. Under Article 73(1), the Annual Budget
Statement is also transmitted to the Senate.
Pursuant to the statutory framework governing public financial management,
the Annual Budget Statement for FY2026-27 includes the Statement of Purpose,
Statement of Contingent Liabilities, and Statement of Fiscal Risks under Section 4 of
the Public Finance Management Act, 2019 (as amended to date), as well as the
Statement of Estimated Tax Expenditures under Section 8 thereof. These statements
strengthen fiscal transparency, enhance accountability, and facilitate informed
oversight of public finances.
In accordance with Sections 5 and 10 of the Fiscal Responsibility and Debt
Limitation Act, 2005 (as amended to date), the Medium-Term Budgetary Statement
and Statements of Fiscal Responsibility are also presented as part of the Annual
Budget Statement, reflecting the Government’s commitment to prudent fiscal
management, debt sustainability, and a credible medium-term macro-fiscal
framework.
“Explanatory Memorandum on Federal Receipts” and “Demands for Grants
and Appropriations” serve as supporting documents of Annual Budget Statement for
FY2026-27 and provide detailed information on the Federal Government’s fiscal
proposals.
IMDAD ULLAH BOSAL
Secretary to the Government of Pakistan
Finance Division
Islamabad, the 12th June, 2026Page 4
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CONTENTS PAGE
I. Summary of Receipts 1
II. Revenue Receipts 2 - 4
III. Capital Receipts 5
IV. External Receipts 6
V. Public Account Receipts 7 - 10
VI. Summary of Expenditure 11
VII. Current Expenditure on Revenue Account 12 - 14
VIII. Current Expenditure on Capital Account 15
IX. Development Expenditure on Revenue Account 16 - 17
X. Development Expenditure on Capital Account 18
XI. Capital Expenditure 19
XII. Public Account Expenditure 20 - 23
XIII. Estimated Charged and Other Expenditure met from 24
Federal Consolidated Fund
XIV. Statement of Purpose 25
XV. Demand for Grants and Appropriations 2026-27 26 - 30
Demand-Wise Expenditure (Schedule-I)
XVI. Demand for Grants and Appropriations 2026-27 31
Object-Wise Expenditure (Schedule III)
XVII. Statement of Contingent Liabilities 32 - 34
XVIII. Statement of Fiscal Risks 35 - 39
40XIX Statement of Estimated Tax Expenditure
XX Medium Term Budgetary Statement 2026-29 41 - 43
XXI Climate Budget Statement 44 - 45
46 - 47XXII Gender Budget Statement
48 - 49XXIII Disaster Budget Statement
XXIV Statements of Responsibility 50 - 51Page 6
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Page 7
SUMMARY OF RECEIPTS
Federal receipts are categorized as Revenue Receipts, Capital Receipts, Public Account
Receipts and External Receipts. These receipts, except Public Account Receipts, become part of
the the Federal Consolidated Fund.
(Rs. in million)
Budget Revised Budget
Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
Revenue Receipts - Federal
A-
Consolidated Fund
B 1 Tax Revenue Receipts 14,131,000 12,983,000 15,264,000
FBR Taxes 14,131,000 12,983,000 15,264,000
B01 Direct Taxes 6,902,000 6,431,754 7,613,000
B02 Indirect Taxes 7,229,000 6,551,246 7,651,000
C 2 Non-Tax Revenue Receipts 5,147,090 5,093,364 5,335,598
B03 Levies and Fees 29,790 37,000 41,589
C01 Income from Property and Enterprises 519,332 480,792 435,760
C02 Receipts from Civil Administration etc 2,450,392 2,467,764 1,480,183
C03 Miscellaneous Receipts 2,147,576 2,107,809 3,378,066
3 Total Revenue Receipts (1+2) 19,278,090 18,076,364 20,599,598
E 4 Capital Receipts 3,266,924 2,888,336 2,186,380
E02 Recovery of Loans and Advances 603,000 749,547 426,309
E03 Domestic Debt Receipts (Bank) - Net 2,663,924 2,138,789 1,760,071
5 Total Internal Receipts (3+4) 22,545,013 20,964,700 22,785,978
6 External Receipts 5,777,554 5,024,517 6,779,624
Total Internal and External Receipts
7 28,322,568 25,989,217 29,565,602
(5+6)
Public Account of Federation Net B -
Receipts
G 8 Public Account Receipts 210,127 281,327 274,378
Deferred Liabilities (Net) 120,610 212,078 231,072
Deposit and Reserves (Net) 89,517 69,249 43,306
9 Gross Federal Resources (7+8) 28,532,695 26,270,544 29,839,980
Less Provincial Share in Federal
10 8,205,723 7,591,797 8,848,492
Taxes
11 Net Federal Resources (9-10) 20,326,972 18,678,747 20,991,488
Cash Balance Surplus by the 12 1,464,000 1,379,000 1,793,844
Provinces
13 Privatization Proceeds 86,550 14,257 160,500
14 Domestic Debt Receipts (Bank) - Net 1,970,590 198,631 2,218,176
15 Total Resources (11+12+13+14) 23,848,112 20,270,635 25,164,008Page 8
REVENUE RECEIPTS
Revenue Receipts constitute major component of total Federal resources. Revenue Receipts are
categorized as Tax Revenue Receipts and Non-Tax Revenue Receipts, and are derived from the
following sources:-
Tax Revenue Receipts
Tax Revenue is administered by the Federal Board of Revenue (FBR), which comprises of
Customs Duty and Inland Revenue i.e Direct Taxes, Sales Tax and Federal Excise Duty. FBR
taxes may also be categorized as Direct Taxes and Indirect Taxes. Direct Taxes comprise of
Income Tax, Capital Value Tax, WWF (Ordinary Collection) and Contribution under Companies
Profit (WPPF). Indirect Taxes include Sales Tax, Federal Excise Duty and Customs Duty. A
snapshot of Budget Estimates is as under:-
(Rs in million)
Budget Revised Budget
Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
B Tax Revenue
FBR Taxes 14,131,000 12,983,000 15,264,000
B01 i.Direct Taxes 6,902,000 6,431,754 7,613,000
B011 Taxes on Income 6,811,243 6,331,484 7,480,521
B017-18 Capital Value Tax (CVT) 17,192 19,606 26,581
B01501 WWF (Ordinary Collection) 25,740 8,453 22,318
WPPF (Contribution underB01502 47,825 72,211 83,580 Companies Profit)
B02 ii.Indirect Taxes 7,229,000 6,551,246 7,651,000
B020-22 Customs Duties 1,588,000 1,366,047 1,651,000
B023 Sales Tax 4,753,000 4,333,908 4,927,000
B024-25 Federal Excise Duty 888,000 851,291 1,073,000
1 Total Tax Revenue (i+ii) 14,131,000 12,983,000 15,264,000Page 9
Non-Tax Revenue Receipts
As per Section 2(a) of the Public Finance Management Act, 2019 (amended), Non-Tax Revenue
means revenues received by the Government in terms of Article 78(1) of the Constitution and the
recurring income of the Government from investments and provision of services but does not
include those mentioned in Article 160(3) of the Constitution. Non-Tax Revenue of the Federal
Government is administered by various Ministries / Divisions / Departments. Budget Estimates
are as under:-
(Rs in million)
Budget Revised Budget
Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
C Non Tax Revenue
B03 a) Levies and Fees 29,790 37,000 41,589
B03087 Mobile Handset Levy 12,000 13,000 14,000
B013-030 Receipts of ICT Administration 17,737 23,928 27,517
B03064 Airport Fee 53 72 72
C01 b) Income from Property and 519,332 480,792 435,760
Enterprises
C01008 PTA (4G/5G Licences) 22,049 24,973 27,685
C01012 PTA (Surplus) 1,100 1,640 1,300
C01012 Regulatory Authorities (Surplus) 6,239 3,387 4,736
C012-18 Mark up Receipts 283,810 249,792 271,653
C012 Mark up Receipts (Provinces) 95,810 93,792 100,802
C013-18 Mark up Receipts ( PSEs & Others) 188,000 156,000 170,851
C019 Dividends 206,134 201,000 130,387
c) Receipts from Civil
C02 2,450,392 2,467,764 1,480,183
Administration & Other Functions
C021-24 General Administration Receipts 5,841 5,180 5,887
C02211 Surplus Profit of State Bank of 2,400,000 2,428,364 1,435,750
Pakistan
C025 Defence Services Receipts 35,442 28,000 31,473
C026 Law and Order Receipts 5,625 3,350 4,091
C027 Community Services Receipts 1,904 1,315 1,339
C028-29 Social Services 1,580 1,554 1,643
C03 d) Miscellaneous Receipts 2,147,576 2,107,809 3,378,066
C031-35 Economic Services Receipts 34,785 65,168 72,727
Contd…..Page 10
(Rs in million)
Budget Revised Budget
Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
Non-Tax Revenue
C03601 Foreign Grants (Budgetary Support) 2,000 6,000 2,000
C03725 Extraordinary Receipts (UNO) 31,200 24,700 25,600
C037 Extraordinary Receipts (Others) 6,400 4,914 5,903
C037 Grants/Receipts from Provinces under - - 1,035,000
Article 164
C03897 Nationalization, Passport and Others 76,500 65,000 73,060
C038 Other Receipts of Attached Deptts 109,009 151,731 165,883
C03901 Petroleum Levy 1,468,395 1,498,000 1,676,509
C03902 Natural Gas Development Surcharge 49,437 63,000 70,814
C03905 Royalty on Crude Oil 69,000 40,000 45,504
C03906 Royalty on Natural Gas 138,000 85,000 95,000
C03910 Discount Retained on Local Crude 30,000 19,488 20,500
Price
C03915 Windfall Levy against Crude Oil 20,000 16,106 17,000
C03916 Gas Infrastructure Development Cess 2,400 2,000 2,248
C03917 Petroleum Levy on LPG 5,000 3,463 3,455
C03919 Windfall Levy on Gas 450 1,239 1,127
C03920 Off the Grid (Captive Power Plant) 105,000 14,000 15,736
Levy
C03924 Climate Support Levy - 48,000 50,000
C 2 Total Non-Tax Revenue (a+b+c+d) 5,147,090 5,093,364 5,335,598
3 Total Revenue Receipts (1+2) 19,278,090 18,076,364 20,599,598Page 11
CAPITAL RECEIPTS
Capital receipts comprise of Recoveries of Loans and Advances from Provinces and other
entities and Domestic Debt which includes Permanent Debt and Floating Debt. Budget Estimates
are as under:-
(Rs in million)
Budget Revised Budget
Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
E02 I. Recoveries of Loans and 603,000 749,547 426,309
Advances
E021 Provinces 584,000 584,000 407,309
E022-27 PSEs and Others 19,000 165,547 19,000
E03 II. Total Domestic Debts Receipts 16,671,113 28,788,804 27,752,272
(a+b)
E031 a) Permanent Debt Receipts 7,323,395 7,709,282 7,188,241
Pakistan Investment Bonds (Bank) 4,079,641 5,046,624 3,099,368
Pakistan Investment Bonds (Non 326,754 529,340 681,873
Bank)
Premium Prize Bonds (Registered) 26,000 24,000 30,000
Ijara Sukuk Bonds 2,514,000 2,109,318 3,000,000
ICBC (Foreign Currency Denominated 377,000 - 377,000
Domestic Loan)
E032 b) Floating Debt Receipts 9,347,718 21,079,522 20,564,031
Prize Bonds 17,718 14,453 14,031
Treasury Bills Through Auction 8,430,000 20,426,372 19,850,000
Govt. Bai-Maujjal Ijara Sukuk 900,000 638,698 700,000
4 Capital Gross Receipts (I+II) 17,274,113 29,538,351 28,178,581
Domestic Debt Receipts 16,671,113 28,788,804 27,752,272
Domestic Debt Repayment (page- 14,007,189 26,650,015 25,992,201
17)
Net Domestic Debt Receipts 2,663,924 2,138,789 1,760,071
5 Total Federal Internal Gross 36,552,203 47,614,715 48,778,179
Receipts (3+4)Page 12
EXTERNAL RECEIPTS
External Resources comprise of loans and grants received from multilateral, bilateral and other
sources. Budget Estimates are as under:-
(Rs in million)
Budget Revised Budget
Description Estimates Estimates Estimates
2025-26 2025-26 2026-27
I. Loans 5,047,928 4,403,351 6,206,394
Project Loans (PSDP) 215,719 300,130 246,073
Federal 89,422 167,765 112,766
Autonomous Bodies 126,297 132,365 133,307
Programme Loans & Grants 418,699 430,405 418,024
Federal & Autonomous Bodies 330,267 313,555 335,313
Provinces 88,433 113,490 82,711
Programme Grants (Federal) - 3,360 -
Other Loans 4,413,510 3,672,816 5,542,297
II. Grants 13,281 10,849 8,927
Project Grants (PSDP) 13,281 10,849 8,927
Federal (PSDP) 11,237 9,856 6,377
Autonomous Bodies 2,044 993 2,550
a. External Receipts (I +II) 5,061,209 4,414,200 6,215,321
b. Project Loans & Grants (Others) 716,345 610,317 564,303
Project Loans (Others) 686,761 580,148 533,036
Federal Projects 241 2,988 8,439
Provinces 686,521 577,161 524,597
Grants (Others) 29,584 30,168 31,267
Federal Projects 2,195 3,475 406
Provinces 27,388 26,694 30,861
6 Total External Receipts 5,777,554 5,024,517 6,779,624Page 13
PUBLIC ACCOUNT RECEIPTS
Article 78(2) provides that all other monies received by or on behalf of the Federal
Government shall be credited into the Public Account of the Federation. Therefore, all the
monies received by or on behalf of the Federal Government in terms of Article 78(2) are Public
Account receipts which are not revenues in terms of Article 78(1) of the Constitution. However,
such Public Account receipts cannot be operated without establishment of Special Purpose
Funds, deposits, reserves etc under the authority of an act of the Parliament or with the approval
of the Federal Government.There are two sources of Public Account Receipts as under:-
National Savings Schemes
National Savings Schemes include Savings bank accounts, Defence Savings Certificates,
Special Savings Certificates, Pensionery Benefit Accounts, Behbood Savings Certificates etc.
(Rs in million)
Budget Revised Budget
Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
i. G111 Investment Deposit Accounts 1,340,945 1,443,580 1,485,072
(Savings Schemes)
G11101 Savings Bank Accounts 606,781 587,084 627,390
G11106 Defence Savings Certificates 37,130 23,332 23,162
G11111 Special Savings Certificates 79,573 96,038 99,252
(Registered)
G11112 Special Savings Accounts 15,422 16,434 16,983
G11113 Regular Income Certificates 101,675 114,451 111,900
G11126 Pensionery Benefit Accounts 91,585 129,722 127,321
G11127 Behbood Saving Certificates 233,715 281,410 273,962
G11130 Shuhada Welfare Accounts 65 110 100
New Sarwa Islamic Saving & Term 55,000 75,000 85,000
Accounts
G11129 Short Term Savings Certificates 120,000 120,000 120,000
ii. G061 Provident Fund 59,606 67,886 67,651
Gross Public Account Receipts ( i+ii ) 1,400,551 1,511,466 1,552,723
1 Gross Public Account Receipts 1,400,551 1,511,466 1,552,723
(i+ii )
Gross Public Account Expenditure 1,279,941 1,299,388 1,321,651
(Page-18)
Net Public Account Receipts 120,610 212,078 231,072
Contd…..Page 14
Deposits and Reserves (Receipts)
Deposits and Reserves represent all monies forming part of the Public Account of the
Federation as per Article 78(2) of the Constitution of Islamic Republic of Pakistan. Budget
estimates of receipts in the following table are however subject to fulfillment of following
stipulations:-
(i) The funds appropriated by the National Assembly out of Federal Consolidated Funds in terms
of Articles 80 to 84 of the Constitution for a particular financial year (being lapsable) shall be
utilized as per Cash Management and TSA Rules 2024 and shall not be deposited under these
deposits and reserves heads of account (being non-lapsable) under the Public Account.
(ii) The maintenance and operation of all these funds, deposits, reserves etc shall be subject to
their due establishment either under the authority of an act of Parliament or with the approval of
the Federal Government, as the case may be.
(iii) Revenues in terms of Article 78(1) of the Constitution shall not be deposited in these deposits
and reserves heads of account under the Public Account. The revenues shall only be deposited
in the respective heads of account of tax revenue and non tax revenue.
(iv) Receipt of funds into these deposits and reserves heads of account shall only be allowed by
the Accounting Offices subject to compliance of the stipulations at (i) to (iii) above and to the
extent of reconciled available balance under the respective head of account.
(Rs in million)
Budget Revised Budget Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
G Deposits and Reserves
FGE Benevolent Funds 2,086 9,117 9,573
G06202 Civil 1,994 9,074 9,527
G06205 Pakistan Post Office Deptt. 7 - -
G06206 Housing & Works Division 53 20 21
G06209 National Savings 25 17 18
G06212 Geological Survey of Pakistan 7 6 6
Group Insurance Fund 485 552 579
G06401 Housing & Works Division 9 5 5
G06404 National Savings 6 4 4
G06407 Geological Survey of Pakistan 3 2 2
G06409 Civil 466 540 567
G07104 Fed. Govt. Empl. Group Insur. Fund 1 - -
PPOD
Contd…..Page 15
(Rs in million)
Budget Revised Budget Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
G Deposits and Reserves
Defence 29,078 11,733 12,319
G06203 FG Employees Benevolent Fund 4,483 4,447 4,669
(Defence)
G06410 Group Insurance Fund (Defence) 1,300 1,328 1,394
G11224 Deposits Accounts with Defence 23,295 5,958 6,256
Pakistan Post Office Department - 209 219
G07106 Pakistan Post Office Miscellaneous - 209 219
Housing & Works Division 3,575 947 994
G10101 Receipts & Collection Account 465 38 40
G10113 Deposits 3,111 909 954
G Deposits and Reserves 172,831 325,650 130,989
Miscellaneous Funds
G06304 Workers Welfare Fund 65,809 73,163 76,821
G06315 Judicial Officers Welfare Fund 3 3 3
G12140 PM Flood Relief Fund 2010 0 5 5
G12150 PM Relief Fund for IDPs 2014 175 - -
G12152 Prime Minister's Flood Relief Fund - - 0.03 0.03
2014
G12157 PM COVID-19 Pandemic Relief Fund 0 0.02 0.02
2020
G12164 PM's Relief Fund Flood, Earthquake - 1,663 1,747
Other Cal.
G12166 PM's Relief Fund for Turkiye & Syria - 25 26
Earthquake
G12169 PM's Relief Fund for Ghaza & 169 15 16
Lebanon
G12186 Prime Minister's Austerity Fund, 2026 - 128,472 -
G12193 Prime Minister's Austerity Fund, 2026 - 81,086 -
for SOEs
G12206 Special Fund for Welfare and Uplift of - 35 37
Minorities
G12226 Federal Govt. Artists Welfare Fund - 2 51
(Heritage)
G12305 Export Development Fund 25,430 8,517 20,000
G11217 National Tariff Commission Fund 500 800 900
G12308 Reserve Fund for Exch. Risk on 2,373 11,506 12,081
Foreign Loans
G12412 Pakistan Oil Seed Development Fund 189 191 201
Contd…..Page 16
(Rs in million)
Budget Revised Budget
Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
G Deposits and Reserves
G12419 Research and Development Fund 3,800 3,583 4,154
G12421 Diamer Basha and Mohmand Dam 61,757 5 5
Fund
G12504 Workers Children Education Fund 0.15 0.07 0.08
G12612 Fund for Urdu Science Board 1 3 3
G12712 Trust Interest Fund (Charitable 4 2 2
Endowment)
G12738 National Fund for Control of Drug 20 81 85
Abuse
G12783 Universal Service Fund 11,000 14,780 12,833
G1270G Board of Investment 400 400 400
Miscellaneous Deposit and Reserve
Accounts
G10104 Mint Receipt and Collection Account - 114 119
G14100 Pakistan Mint 1,200 1,200 1,500
2 Gross Receipts (Deposits and 208,054 348,207 154,674
Reserves)
Exp. Deposit and Reserves 118,537 278,958 111,368
(page-23)
Net Deposit and Reserves Receipts 89,517 69,249 43,306
3 Gross Receipts (1+2) 1,608,605 1,859,673 1,707,397
Gross Expenditure (page-23) 1,398,478 1,578,346 1,433,019
7 PUBLIC ACCOUNT NET RECEIPTS 210,127 281,327 274,378Page 17
SUMMARY OF EXPENDITURE
(Current & Development)
In this table, Budget Estimates of current expenditure (on revenue and capital account) and
Budget Estimates of Development expenditure (on revenue and capital accounts) have been
mentioned as per Article 80(2) of the Constitution of Pakistan.
(Rs in million)
Budget Revised Budget
Function
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
Current Expenditure
a. Current Exp. on Revenue 16,286,045 15,006,324 17,495,417
Account
01 General Public Services 12,210,851 10,782,451 12,799,647
02 Defence Affairs and Services 2,557,950 2,595,715 3,010,900
03 Public Order and Safety Affairs 351,679 373,317 389,469
04 Economic Affairs 242,144 245,222 238,438
05 Environment Protection 3,168 2,740 2,406
06 Housing and Community Amenities 19,249 12,560 18,570
07 Health 31,975 60,245 37,438
08 Recreation, Culture and Religion 22,158 36,317 23,796
09 Education Affairs and Services 112,683 169,026 117,748
10 Social Protection 734,187 728,730 857,007
b. Current Exp. on Capital Account 5,787,114 3,607,449 6,061,282
011 Foreign Loans Repayment 5,472,222 3,326,037 5,836,275
011 Repayment of Short Term Foreign 199,810 164,453 130,292
014 Transfers 115,082 116,959 94,715
1 Total Current Expenditure (a + b) 22,073,159 18,613,773 23,556,699
Development Expenditure
c. Dev. Exp. on Revenue Account 590,774 501,057 575,295
d. Dev. Exp. on Capital Account 1,184,179 1,155,804 1,032,014
2 Total Development Expenditure 1,774,953 1,656,862 1,607,309
(c+d)
Grand Total - Expenditure (1+2) 23,848,112 20,270,635 25,164,008
3 Break-up of Expenditure
Revenue Account (a+c) 16,876,819 15,507,381 18,070,713
Capital Account (b+d) 6,971,293 4,763,254 7,093,295
Total Expenditure: 23,848,112 20,270,635 25,164,008Page 18
Current Expenditure on Revenue Account
(Rs in million)
Budget Revised Budget
Function
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
01 General Public Service 12,210,851 10,782,451 12,799,647
011 Executive & Legislative Organs, 10,397,794 8,861,174 10,326,003
Financial & Fiscal Affairs, External
Affairs
Debt Servicing 8,207,250 6,937,459 8,054,000
Servicing of Foreign Debt 1,009,322 930,918 1,071,393
Servicing of Domestic Debt 7,197,928 6,006,541 6,982,607
Superannuation Allowances & 1,055,000 1,055,000 1,169,000
Pensions
Others (Details are in "Demands for 1,135,544 868,715 1,103,003 Grants & Appropriation" book.)
012 Foreign Economic Aid 5,793 5,793 5,203
014 Transfers 1,682,477 1,791,068 2,330,690
Provinces 150,000 150,000 152,000
Others (Details are in "Budget in Brief" 1,532,477 1,641,068 2,178,690 book.)
015 General Services 23,990 22,404 25,073
016 Basic Research 10,229 9,758 11,080
017 Research & Dev. General Public 30,214 30,088 33,246
Services
018 Admn. of General Public Service 9,869 10,031 10,578
019 Gen. Public Services not elsewhere 50,484 52,137 57,774
defined
02 Defence Affairs and Services 2,557,950 2,595,715 3,010,900
021 Defence Services 2,550,000 2,583,968 3,000,000
A01 Employees Related Expenses 846,032 851,080 967,548
A03 Operating Expenses 704,399 721,030 743,462
A09 Physical Assets 663,077 663,923 925,833
A12 Civil Works 336,492 347,935 363,158
025 Defence Administration 7,950 11,747 10,900
03 Public Order and Safety Affairs 351,679 373,317 389,469
031 Law Courts 19,380 21,532 25,756
032 Police & Civil Armed Forces 321,177 327,670 350,404
033 Fire Protection 709 671 748
034 Prison Administration and Operation 181 167 187
035 R&D Public Order and Safety 98 195 104
036 Administration of Public Order 10,135 23,082 12,270
Contd…..Page 19
Current Expenditure on Revenue Account
(Rs in million)
Budget Revised Budget
Function
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
04 Economic Affairs 242,144 245,222 238,438
041 Gen. Eco., Commercial & Labour 117,035 103,642 110,199
Affairs
042 Agri., Food, Irrigation, Forestry & 33,476 40,645 33,204
Fisheries
043 Fuel and Energy 2,397 2,343 1,360
044 Mining and Manufacturing 7,586 18,888 10,267
045 Construction and Transport 46,228 44,998 46,405
046 Communications 33,103 32,369 34,517
047 Other Industries 1,525 1,568 1,527
048 Research & Development Economic 793 768 957
Affairs
05 Environment Protection 3,168 2,740 2,406
053 Pollution Abatement 2,155 1,655 1,155
055 Administration of Environment 1,013 1,085 1,251
Protection
06 Housing and Community Amenities 19,249 12,560 18,570
061 Housing Development 1,588 129 143
062 Community Development 17,661 12,431 18,427
07 Health 31,975 60,245 37,438
071 Medical Products, Appliances and 32 33 38
Equipments
073 Hospital Services 24,035 24,547 28,779
074 Public Health Services 1,139 30,813 1,204
076 Health Administration 6,768 4,851 7,417
Contd…..Page 20
Current Expenditure on Revenue Account
(Rs in million)
Budget Revised Budget
Function
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
08 Recreation, Culture and Religion 22,158 36,317 23,796
081 Recreational and Sporting Services - 70 -
082 Cultural Services 1,503 1,473 1,591
083 Broadcasting and Publishing 16,488 31,074 17,673
084 Religious Affairs 2,094 2,029 2,204
086 Admn. of Information, Recreation & 2,074 1,671 2,328
Culture
09 Education Affairs and Services 112,683 169,026 117,748
091 Pre-Primary and Primary Education 5,841 5,904 6,275
Affairs and Services
092 Secondary Education Affairs and 14,420 14,704 16,015
Services
093 Tertiary Education Affairs and 82,012 83,569 84,462
Services
094 Education Services Not definable by 3,738 4,014 3,878
Level
095 Subsidiary Services to Education 392 406 410
096 Administration 4,825 4,457 5,224
097 Education Affairs & Services not 1,455 55,973 1,484
Elsewhere Classified
10 Social Protection 734,187 728,730 857,007
107 Administration 5,890 9,555 4,975
108 Others 1,303 1,643 2,556
109 Social Protection (Not elsewhere 726,994 717,532 849,477
classified)
a.Current Expenditure on Revenue 16,286,045 15,006,324 17,495,417
Account
Revised Estimates 2025-26 are as of 15th May, 2026 based on SAP SystemPage 21
Current Expenditure on Capital Account
(Rs in million)
Budget Revised Budget
Function
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
01 General Public Service 5,787,114 3,607,449 6,061,282
011 Foreign Loan Repayment 5,472,222 3,326,037 5,836,275
011 Repayment of Short Term Foreign 199,810 164,453 130,292
Credits
014 Transfers 115,082 116,959 94,715
Federal Misc. Investments and Other 115,082 116,959 94,715
Loans and Advances
b. Current Expenditure on 5,787,114 3,607,449 6,061,282
Capital Account
I. Total Current Expenditure (a+b) 22,073,159 18,613,773 23,556,699Page 22
Development Expenditure on Revenue Account
(Rs in million)
Budget Revised Budget
Function
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
01 General Public Service 391,839 313,426 367,805
011 Executive & Legislative Organs, 10,481 17,830 13,846
Financial & Fiscal Affairs, External
Affairs
014 Transfers 331,130 252,384 294,286
015 General Services 29,260 26,749 36,982
016 Basic Research 19,670 15,708 22,198
017 Research & Dev. General Public 921 463 160
Services
019 General Public Services not 377 291 333
elsewhere defined
02 Defence Affairs and Services 2,720 2,668 2,961
021 Military Defence 556 865 387
024 R & D Defence 248 246 1,054
025 Defence Administration 1,916 1,557 1,520
03 Public Order and Safety Affairs 2,921 2,103 5,743
031 Law Courts 1,912 1,583 2,403
032 Police and Civil Armed Forces 986 497 3,340
036 Administration of Public Order 23 23 -
04 Economic Affairs 105,611 104,589 79,382
041 Gen. Eco. Commercial and Labour 4,058 1,064 2,563
Affairs
042 Agri,,Food, Irrigation, Forestry & 72,162 69,779 49,629
Fisheries
043 Fuel and Energy 7,009 13,367 8,451
044 Mining and Manufacturing 1,105 420 761
045 Construction and Transport 20,325 17,794 16,965
046 Communications 814 2,066 449
048 Research & Development Economic 138 99 564
Affairs
05 Environment Protection 2,784 2,292 2,478
055 Administration of Environment Protection 2,784 2,292 2,478
06 Housing and Community Amenities 7,977 6,596 14,189
062 Community Development 7,971 6,590 14,189
063 Water Supply 6 6 -
Contd…..Page 23
DEVELOPMENT EXPENDITURE ON REVENUE ACCOUNT
(Rs in million)
Budget Revised Budget
Function
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
07 Health 15,102 13,691 18,217
073 Hospital Services 6,107 6,273 8,690
074 Public Health Services 8,700 7,138 5,962
076 Health Administration 295 280 3,565
08 Recreation, Culture and Religion 3,697 2,479 2,822
081 Recreation and Sporting Services 1,180 1,180 1,851
082 Cultural Services 250 - -
083 Broadcasting and Publishing 1,616 1,249 659
084 Religious Affairs 650 50 312
09 Education Affairs and Services 55,824 52,639 76,381
093 Tertiary Edu. Affairs & Services 52,175 50,638 72,059
095 Subsidiary Services to Education 650 362 722
096 Administration 750 - -
097 Education Affairs & Services not 2,249 1,639 3,600
Elsewhere Classified
10 Social Protection 2,300 574 5,317
107 Administration 2,300 574 5,317
c. Dev. Exp. on Revenue Account 590,774 501,057 575,295
Revised Estimates of Development Expenditure 2025-26 are as of 15th May, 2026 based on SAP
SystemPage 24
DEVELOPMENT EXPENDITURE ON CAPITAL ACCOUNT
(Rs in Million)
Budget Revised Budget
Function Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
01 General Public Service 1,163,036 1,131,537 1,006,723
014 Transfers 1,162,275 1,130,776 1,005,388
017 Research and Dev. General Public 761 761 1,335
Services
04 Economic Affairs 21,144 24,268 25,290
041 Gen. Eco., Commercial and Labour 719 368 312
Affairs
043 Fuel and Energy - 244 -
044 Mining and Manufacturing 1,904 1,714 6,658
045 Construction and Transport 17,280 21,309 17,821
046 Communications 1,241 632 500
d. Dev. Expenditure on Capital 1,184,179 1,155,804 1,032,014
Account
II.Total Development Expenditure 1,774,953 1,656,862 1,607,309
(c+d)
III.Total Exp. 23,848,112 20,270,635 25,164,008
(Current+Development)Page 25
CAPITAL EXPENDITURE
The expenditure incurred on repayment of domestic debt is termed as Capital Expenditure.
(Rs in million)
Budget Revised Budget
Object Code Description Estimates Estimates Estimates
2025-26 2025-26 2026-27
A101 i.Domestic Permanent Debt 6,069,033 6,807,142 6,488,501
Pakistan Investment Bonds (Bank) 4,079,641 5,046,624 3,099,368
Pakistan Investment Bonds (Non 179,359 481,371 295,632
Bank)
Foreign Exchange Bearer Certificates 1 0.01 0.10
Foreign Currency Bearer Certificates 1 0.01 0.10
US Dollar Bearer Certificates 1 0.01 0.10
Special US Dollar Bonds 30 0.03 0.30
Premium Prize Bonds (Registered) 16,000 12,000 15,000
Ijara Sukuk Bond 1,414,000 1,265,712 2,700,000
Pakistan Banao Certificates (5-years) 3,000 1,435 1,500
Principal Repayment of Foreign 377,000 - 377,000
Currency Denomated - Domestic Debt
A104 ii.Floating Debt 7,938,156 19,842,874 19,503,700
Prize Bonds 5,156 3,694 3,700
Treasury Bills through Auction 7,930,000 19,836,680 19,500,000
Bai-Maujjal Ijara Sukuk Bonds 3,000 2,500 -
A10 IV. Total Public Debt Repayment (i+ii) 14,007,189 26,650,015 25,992,201
V. Total - Federal Consolidated Fund 37,855,301 46,920,650 51,156,209
Disbursement (III+IV)Page 26
PUBLIC ACCOUNT EXPENDITURE
National Savings Schemes
The expenditure incurred on repayment of National Savings Schemes is termed as Public
Account Expenditure.
(Rs in million)
Budget Revised Budget
Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
i. G111 Investment Deposit Accounts 1,199,657 1,211,018 1,237,670
(Savings Schemes)
G11101 Savings Bank Accounts 597,849 586,921 617,333
G11103 Khas Deposit Accounts 5 5 5
G11104 Mahana Amadni Accounts 100 110 100
G11106 Defence Savings Certificates 53,940 42,065 44,516
G11108 National Deposit Certificates 1 1 1
G11109 Khaas Deposit Certificates 1 1 1
G11111 Special Savings Certificates 74,554 88,070 89,782
(Registered)
G11112 Special Savings Accounts 14,449 15,070 15,363
G11113 Regular Income Certificate 72,519 57,311 57,032
G11126 Pensionery Benefits 61,410 62,788 63,693
G11127 Behbood Saving Certificate 158,803 154,632 159,819
G11130 Shauhda Welfare Account 25 45 25
New Sarwa Islamic Saving & Term 51,000 62,000 60,000
Accounts
Short Term Savings Certificates 115,000 142,000 130,000
(STSC)
ii. G061 Provident Fund 80,285 88,370 83,981
1 Total Expenditure ( i+ii ) 1,279,941 1,299,388 1,321,651
Contd…..Page 27
Deposits and Reserves
Deposits and Reserves represent all monies forming part of the Public Account of the Federation
as per Article 78(2) of the Constitution of Islamic Republic of Pakistan. Budget estimates of
Expenditure (withdrawal of funds) from the Deposits and Reserves as depicted in the following
table are however subject to fulfillment of following stipulations:-
(i) The maintenance and operation of all these funds, deposits, reserves etc shall be subject to
their due establishment either under the authority of an act of Parliament or with the approval of
the Federal Government, as the case may be.
(ii) Withdrawal of funds from these deposits and reserves heads of account shall only be allowed
by the Accounting Offices subject to compliance of the stipulations at (i) above and to the extent
of reconciled available balance under the respective head of account.
(iii) There shall be no authority of direct access to Central Account No.1 (Non Food) in SBP.
(iv) Withdrawal of funds from these Deposits and Reserves heads of account shall be in
accordance with the provisions of Public Finance Management Act, 2019, Cash Management
and Treasury Single Account Rules 2024 and the Special Assignment Account Procedure for the
Public Account of the Federation 2021. Personal Ledger Accounts shall not be used for
withdrawal of funds.
(Rs in million)
Budget Revised Budget
Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
G Deposits and Reserves
FGE Benevolent Funds 1,535 8,951 9,398
G06202 Civil 1,455 8,913 9,359
G06206 Housing & Works Division 50 17 18
G06209 National Savings 23 17 18
G06212 Geological Survey of Pakistan 6 4 4
Group Insurance Fund 270 466 489
G06401 Housing & Works Division 5 6 6
G06404 National Savings 6 4 4
G06407 Geological Survey of Pakistan 2 2 2
G06409 Civil 257 454 477
Contd.....….Page 28
(Rs in million)
Budget Revised Budget
Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
G Deposits and Reserves
Defence 8,748 8,998 9,448
G06203 FG Employees Benevolent Fund 3,851 3,815 4,006
(Defence)
G06410 Group Insurance Fund (Defence) 1,272 1,295 1,359
G11224 Deposits Accounts with Defence 3,625 3,888 4,082
Pakistan Post Office Department 2 138 145
G07101 Post Office Renewal Reserve Fund 2 - -
G07106 Pakistan Post Office Miscellaneous - 138 145
Housing & Works Division 21,476 2,775 2,914
G10101 Receipts & Collection Account 465 30 32
G10113 Deposits 21,011 2,745 2,882
G Deposits and Reserves 86,506 257,630 88,973
Miscellaneous Funds
G06304 Workers Welfare Fund 23,782 27,885 29,279
G06315 Judicial Officers Welfare Fund 0.19 0.349 0.366
G12140 PM Flood Relief Fund 2010 0.00 0.183 0.192
G12150 PM Relief Fund for IDPs 2014 1,379 - -
G12152 Prime Minister's Flood Relief Fund - - 0.07 0.08
2014
G12157 PM COVID-19 Pandemic Relief Fund - 0.02 0.02
2020
G12164 PM's Relief Fund Flood, Earthquake - 935 982
Other Cal.
G12166 PM's Relief Fund for Turkiye & Syria - 0.29 0.30
Earthquake
G12169 PM's Relief Fund for Ghaza & 1 171 179
Lebanon
G12186 Prime Minister's Austerity Fund, 2026 - 127,112 1,361
G12193 Prime Minister's Austerity Fund, 2026 - 64,426 16,660
for SOEs
G12206 Special Fund for Welfare & Uplift of - 19 19
Minorities
G12226 Federal Govt. Artists Welfare Fund - 67 55
(Heritage)
G12305 Export Development Fund 12,300 27,300 30,000
G11217 National Tariff Commission Fund 500 - -
Contd.....….Page 29
(Rs in million)
Budget Revised Budget
Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
G12308 Reserve Fund for Exch. Risk on - - -
Foreign Loans
G12412 Pakistan Oil Seed Development Fund - - -
G12419 Reserch & Development Fund 2,167 1,651 1,734
G12421 Diamer Bhasha and Mohmand Dam 30,878 - -
Fund
G12504 Workers Children Education Fund - - -
G12612 Fund for Urdu Science Board 0.18 2 3
G12712 Trust Interest Fund (Charitable - 0.02 0.02
Endowment)
G12738 National Fund for Control of Drug - 0.06 0.07
Abuse
G12783 Universal Service Fund 10,431 6,648 6,981
G1270G Board of Investment 100 100 100
G Deposits and Reserves
Miscellaneous Deposits and
Reserves Accounts
G10104 Mint Receipt and Collection Account 3,768 114 119
G14100 Pakistan Mint 1,200 1,200 1,500
2 Total Deposits and Reserves 118,537 278,958 111,368
3 Total Public Account Expenditure 1,398,478 1,578,346 1,433,019
(1+2)Page 30
STATEMENT OF ESTIMATED CHARGED
AND VOTED EXPENDITURE
In terms of Article 80(2) of the Constitution of Pakistan, this statement distinguishes charged and
voted expenditure.
(Rs in million)
Budget Revised Budget
Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
I. Expenditure on Revenue Account 16,876,819 15,507,381 18,070,713
Current 16,286,045 15,006,324 17,495,417
Development 590,774 501,057 575,295
Total-Authorized Expenditure 16,876,819 15,507,381 18,070,713
Charged 8,319,604 7,051,096 8,175,483
Voted 8,557,215 8,456,285 9,895,229
II. Expenditure on Capital Account 20,978,482 31,413,269 33,085,496
Current 19,794,303 30,257,464 32,053,483
Development 1,184,179 1,155,804 1,032,014
Total Authorized Expenditure 20,978,482 31,413,269 33,085,496
Charged 20,454,174 30,915,459 32,566,077
Voted 524,308 497,810 519,419
III. Total Expenditure met from Federal
Consolidated Fund 37,855,301 46,920,650 51,156,209
Current Expenditure 36,080,348 45,263,788 49,548,900
Development Expenditure 1,774,953 1,656,862 1,607,309
IV. Total-Authorized Expenditure 37,855,301 46,920,650 51,156,209
Charged - Total 28,773,778 37,966,554 40,741,560
Voted - Total 9,081,523 8,954,095 10,414,649Page 31
Statement of Purpose
This Statement is submitted in accordance with Section 4 of the Public
Finance Management Act, 2019 (as amended to date). The demands for grants for
FY2026-27 reflect the Federal Government’s commitment to fiscal discipline,
macroeconomic stability, and efficient allocation of public resources in line with its
medium-term reform and development priorities.
In framing the budget, priority has been accorded to key sectors including
health, education, social protection, climate resilience, gender equity and human
capital development. The Government remains committed to improving the quality
and targeting of public expenditure while ensuring adequate fiscal space for essential
social and development needs.
At the same time, the budget continues to support economic recovery and
inclusive growth through sustained support for productive sectors, including
agriculture, industry, and small and medium enterprises, alongside measures to
enhance competitiveness, employment generation, and private sector participation.
IMDAD ULLAH BOSAL
Secretary to the Government of Pakistan
Finance Division
Islamabad, the 12th June, 2026Page 32
Statement of Demand-Wise Expenditure for Budget Estimates 2026-27 (Schedule I)
(Rs. in million)
Budget Estimates 2026-27Demand
No. Ministries / Divisions Charged Voted Total
1 CABINET - 710 710
2 CABINET DIVISION - 5,941 5,941
3 EMERGENCY RELIEF AND REPATRIATION - 1,797 1,797
4 ATOMIC ENERGY - 22,578 22,578
5 PAKISTAN NUCLEAR REGULATORY AUTHORITY - 2,357 2,357
6 NAYA PAKISTAN HOUSING DEVELOPMENT AUTHORITY - 143 143
7 PRIME MINISTER'S OFFICE (INTERNAL) - 895 895
8 PRIME MINISTER'S OFFICE (PUBLIC) - 921 921
9 NATIONAL DISASTER MANAGEMENT AUTHORITY - 1,048 1,048
10 BOARD OF INVESTMENT - 858 858
11 PRIME MINISTER'S INSPECTION COMMISSION - 200 200
12 SPECIAL TECHNOLOGY ZONE AUTHORITY - 952 952
13 NATIONAL ANTI-MONEY LAUDERING & COUNTER - 205 205
FINANCING OF TERRORISM AUTHORITY
14 CANNABIS CONTROL & REGULATORY AUTHORITY - 250 250
15 ESTABLISHMENT DIVISION - 10,177 10,177
16 FEDERAL PUBLIC SERVICE COMMISSION - 1,474 1,474
17 NATIONAL SCHOOL OF PUBLIC POLICY - 3,515 3,515
18 CIVIL SERVICES ACADEMY - 2,088 2,088
19 NATIONAL SECURITY DIVISION - 489 489
20 COUNCIL OF COMMON INTEREST (SECRETARIAT) - 118 118
21 SPECIAL INVESTMENT FACILITATION COUNCIL - 354 354
DIVISION (SIFCD)
22 INTELLIGENCE BUREAU DIVISION - 22,961 22,961
23 CLIMATE CHANGE AND ENVIRONMENTAL - 1,315 1,315
COORDINATION DIVISION
24 COMMERCE DIVISION - 27,910 27,910
25 COMMUNICATIONS DIVISION - 355 355
26 OTHER EXPENDITURE OF COMMUNICATIONS DIVISION - 36,137 36,137
27 PAKISTAN POST OFFICE DEPARTMENT 5 25,537 25,542
28 DEFENCE DIVISION - 17,101 17,101
29 FEDERAL GOVERNMENT EDUCATIONAL INSTITUTIONS - 17,582 17,582
IN CANTONMENTS AND GARRISONS
30 AIRPORTS SECURITY FORCE - 21,651 21,651
31 DEFENCE SERVICES - 3,000,000 3,000,000
32 DEFENCE PRODUCTION DIVISION - 1,140 1,140
33 ECONOMIC AFFAIRS DIVISION - 985 985
34 MISCELLANEOUS EXPENDITURE OF ECONOMIC - 14,026 14,026
AFFAIRS DIVISION
35 POWER DIVISION - 578,837 578,837
36 PETROLEUM DIVISION - 1,112 1,112
37 GEOLOGICAL SURVEY OF PAKISTAN - 1,201 1,201Page 33
Statement of Demand-Wise Expenditure for Budget Estimates 2026-27 (Schedule I)
(Rs. in million)
Budget Estimates 2026-27Demand
No. Ministries / Divisions Charged Voted Total
38 FEDERAL EDUCATION AND PROFESSIONAL TRAINING - 42,748 42,748
DIVISION
39 HIGHER EDUCATION COMMISSION (HEC) - 66,432 66,432
40 NATIONAL RAHMATUL-LIL-AALAMEEN WA KHATAMUN - 116 116
NABIYYIN AUTHORITY
41 NATIONAL VOCATIONAL & TECHNICAL TRAINING - 1,092 1,092
COMMISSION (NAVTTC)
42 NATIONAL HERITAGE AND CULTURE DIVISION - 2,605 2,605
43 FINANCE DIVISION - 5,661 5,661
44 OTHER EXPENDITURE OF FINANCE DIVISION - 9,873 9,873
45 CONTROLLER GENERAL OF ACCOUNTS - 14,914 14,914
46 SUPERANNUATION ALLOWANCES AND PENSIONS 6,936 1,162,064 1,169,000
47 GRANTS SUBSIDIES AND MISCELLANEOUS 57,000 2,504,467 2,561,467
EXPENDITURE
48 REVENUE DIVISION - 106 106
49 FEDERAL BOARD OF REVENUE - 85,604 85,604
50 FOREIGN AFFAIRS DIVISION - 5,012 5,012
51 FOREIGN MISSIONS 500 63,160 63,660
52 HOUSING AND WORKS DIVISION - 5,925 5,925
53 HUMAN RIGHTS DIVISION - 1,832 1,832
54 NATIONAL COMISSION FOR HUMAN RIGHTS - 271 271
55 NATIONAL COMMISSION ON THE RIGHTS OF CHILD - 98 98
56 NATIONAL COMMISSION ON THE STATUS OF WOMEN - 132 132
57 INDUSTRIES AND PRODUCTION DIVISION - 22,882 22,882
58 INFORMATION AND BROADCASTING DIVISION - 11,015 11,015
59 MISCELLANEOUS EXPENDITURE OF INFORMATION AND - 15,898 15,898
BROADCASTING DIVISION
60 INFORMATION TECHNOLOGY AND - 22,495 22,495
TELECOMMUNICATION DIVISION
61 INTERIOR AND NARCOTICS CONTROL DIVISION - 26,652 26,652
62 OTHER EXPENDITURE OF INTERIOR DIVISION - 23,125 23,125
63 ISLAMABAD CAPITAL TERRITORY (ICT) - 23,221 23,221
64 COMBINED CIVIL ARMED FORCES - 298,052 298,052
65 NATIONAL COUNTER TERRORISM AUTHORITY - 1,356 1,356
66 INTER-PROVINCIAL COORDINATION DIVISION - 3,171 3,171
67 KASHMIR AFFAIRS, GILGIT-BALTISTAN AND STATES - 2,557 2,557
AND FRONTIER REGIONS DIVISION
68 LAW AND JUSTICE DIVISION 539 11,123 11,663
69 FEDERAL JUDICIAL ACADEMY - 355 355
70 FEDERAL SHARIAT COURT - 1,127 1,127
71 COUNCIL OF ISLAMIC IDEOLOGY - 322 322
72 NATIONAL ACCOUNTABILITY BUREAU - 7,740 7,740
73 DISTRICT JUDICIARY, ISLAMABAD CAPITAL TERRITORY - 1,848 1,848Page 34
Statement of Demand-Wise Expenditure for Budget Estimates 2026-27 (Schedule I)
(Rs. in million)
Budget Estimates 2026-27Demand
No. Ministries / Divisions Charged Voted Total
74 MARITIME AFFAIRS DIVISION - 2,344 2,344
75 NATIONAL ASSEMBLY 7,969 9,036 17,005
76 THE SENATE 6,453 3,217 9,670
77 NATIONAL FOOD SECURITY AND RESEARCH DIVISION - 22,232 22,232
78 PAKISTAN AGRICULTURAL RESEARCH COUNCIL - 7,291 7,291
79 NATIONAL HEALTH SERVICES, REGULATIONS AND - 37,222 37,222
COORDINATION DIVISION
80 OVERSEAS PAKISTANIS AND HUMAN RESOURCE - 3,735 3,735
DEVELOPMENT DIVISION
81 PARLIAMENTARY AFFAIRS DIVISION - 1,209 1,209
82 PLANNING, DEVELOPMENT AND SPECIAL INITIATIVES - 9,584 9,584
DIVISION
83 POVERTY ALLEVIATION AND SOCIAL SAFETY DIVISION - 806 806
84 BENAZIR INCOME SUPPORT PROGRAME (BISP) - 844,780 844,780
85 PAKISTAN BAIT-UL-MAL - 14,390 14,390
86 PRIVATIZATION DIVISION - 1,330 1,330
87 RAILWAYS DIVISION - 70,478 70,478
88 RELIGIOUS AFFAIRS AND INTER-FAITH HARMONY - 2,091 2,091
DIVISION
89 SCIENCE AND TECHNOLOGY DIVISION - 15,974 15,974
90 WATER RESOURCES DIVISION - 4,241 4,241
91 FEDERAL MISCELLANEOUS INVESTMENTS AND OTHER - 94,715 94,715
LOANS AND ADVANCES
92 DEVELOPMENT EXPENDITURE OF CABINET DIVISION - 63,516 63,516
93 DEVELOPMENT EXPENDITURE OF BOARD OF - 761 761
INVESTMENT
94 DEVELOPMENT EXPENDITURE OF SPECIAL - 564 564
TECHNOLOGY ZONES AUTHORITY
95 DEVELOPMENT EXPENDITURE OF ESTABLISHMENT - 1,786 1,786
DIVISION
96 DEVELOPMENT EXPENDITURE OF SUPARCO - 4,895 4,895
97 DEVELOPMENT EXPENDITURE OF SIFC DIVISION - 480 480
98 DEVELOPMENT EXP OF CLIMATE CHANGE AND ENV. - 2,478 2,478
COORDINATION DIVISION
99 DEVELOPMENT EXPENDITURE OF COMMERCE - 89 89
DIVISION
100 DEVELOPMENT EXPENDITURE COMMUNICATION - 4,440 4,440
DIVISION
101 DEVELOPMENT EXPENDITURE OF DEFENCE DIVISION - 10,903 10,903
102 DEVELOPMENT EXPENDITURE OF DEFENCE - 980 980
PRODUCTION DIVISION
103 DEVELOPMENT EXPENDITURE OF POWER DIVISION - 3,197 3,197
104 DEVELOPMENT EXPENDITURE OF FEDERAL - 28,411 28,411
EDUCATION & PR. TR. DIVISIONPage 35
Statement of Demand-Wise Expenditure for Budget Estimates 2026-27 (Schedule I)
(Rs. in million)
Budget Estimates 2026-27Demand
No. Ministries / Divisions Charged Voted Total
105 DEVELOPMENT EXPENDITURE OF HIGHER EDUCATION - 46,000 46,000
COMMISSION
106 DEVELOPMENT EXPENDITURE OF NATIONAL - 7,901 7,901
VOCATIONAL & TECHNICAL TRAINING COMMISSION
(NAVTTC)
107 DEVELOPMENT EXPENDITURE OF NATIONAL - 445 445
HERITAGE & CULTURE DIVISION
108 DEVELOPMENT EXPENDITURE OF FINANCE DIVISION - 1,440 1,440
109 OTHER DEVELOPMENT EXPENDITURE - 231,086 231,086
110 DEVELOPMENT EXPENDITURE OF REVENUE DIVISION - 11,570 11,570
111 DEVELOPMENT EXPENDITURE OF INFORMATION & - 659 659
BROADCASTING DIVISION
112 DEVELOPMENT EXPENDITURE INFORMATION - 19,580 19,580
TECHNOLOGY & TELECOMMUNICATION DIVISION
113 DEVELOPMENT EXPENDITURE OF INTERIOR & - 21,825 21,825
NARCOTICS CONTROL DIVISION
114 DEVELOPMENT EXPENDITURE OF INTER-PROVINCIAL - 1,851 1,851
COORDINATION DIVISION
115 DEVELOPMENT EXP. OF K.A, GB & SAFRON DIVISION - 623 623
116 DEVELOPMENT EXPENDITURE OF LAW & JUSTICE - 2,403 2,403
DIVISION
117 DEVELOPMENT EXPENDITURE OF NATIONAL FOOD - 4,183 4,183
SECURITY AND RESEARCH DIVISION
118 DEVELOPMENT EXPENDITURE OF NATIONAL HEALTH - 16,065 16,065
SERVICES, REGULATION AND COORD. DIVISION
119 DEVELOPMENT EXPENDITURE OF PRIVIATISATION - 410 410
DIVISION
120 DEVELOPMENT EXPENDITURE OF PLANNING, - 27,626 27,626
DEVELOPMENT AND SPECIAL INITIATIVES DIVISION
121 DEVELOPMENT EXPENDITURE OF RELIGIOUS AFFAIRS - 312 312
AND INTER FAITH HAROMONY DIVISION
122 DEVELOPMENT EXPENDITURE OF SCIENCE & - 3,567 3,567
TECHNOLOGY DIVISION
123 DEVELOPMENT EXPENDITURE OF WATER RESOURCES - 55,251 55,251
DIVISION
124 CAPITAL OUTLAY ON DEVELOPMENT OF ATOMIC - 1,335 1,335
ENERGY
125 EXTERNAL DEVELOPMENT LOANS AND ADVANCES OF - 59,255 59,255
COMMUNICATION DIVISION
126 CAPITAL OUTLAY ON PETROLEUM DIVISION - 312 312
127 EXTERNAL DEVELOPMENT LOANS AND ADVANCES OF - 76,608 76,608
POWER DIVISION
128 CAPITAL OUTLAY ON FEDERAL INVESTMENTS - 2,360 2,360
129 DEVELOPMENT LOANS AND ADVANCES BY THE 169,210 169,210
FEDERAL GOVERNMENT
130 EXTERNAL DEVELOPMENT LOANS AND ADVANCES BY 607,309 2,300 609,609
THE FEDERAL GOVERNMENT
131 CAPITAL OUTLAY ON CIVIL WORKS - 16,395 16,395
132 CAPITAL OUTLAY ON INDUSTRIAL DEVELOPMENT - 6,658 6,658Page 36
Statement of Demand-Wise Expenditure for Budget Estimates 2026-27 (Schedule I)
(Rs. in million)
Budget Estimates 2026-27Demand
No. Ministries / Divisions Charged Voted Total
133 CAPITAL OUTLAY ON MARITIME AFFAIRS DIVISION - 1,780 1,780
134 CAPITAL OUTLAY ON RAILWAY DIVISION - 40,658 40,658
135 EXTERNAL DEVELOPMENT LOANS AND ADVANCES OF - 47,835 47,835
WATER RESOURCE DIVISION
STAFF HOUSEHOLD & ALLOWANCES OF THE
964 964 PRESIDENT(PUBLIC)
STAFF HOUSEHOLD & ALLOWANCES OF THE
1,837 1,837 PRESIDENT(PERSONAL)
SERVICING OF FOREIGN DEBT 1,071,393 1,071,393
FOREIGN LOANS REPAYMENT 5,836,275 5,836,275
REPAYMENT OF SHORT TERM FOREIGN CREDITS 130,292 130,292
AUDIT 9,820 9,820
SERVICING OF DOMESTIC DEBT 6,982,607 6,982,607
REPAYMENT OF DOMESTIC DEBT 25,992,201 25,992,201
SUPREME COURT 7,441 7,441
ISLAMABAD HIGH COURT 2,367 2,367
ELECTION 10,578 10,578
FEDERAL OMBUDSMAN SECRETARIAT FOR
PROTECTION AGAINST HARASSMENT OF WOMEN AT 259 259
WORKPLACE
WAFAQI MOHTASIB 2,124 2,124
FEDERAL TAX OMBUDSMAN 646 646
FEDERAL CONSTITUTIONAL COURT OF PAKISTAN 6,048 6,048
TOTAL 40,741,560 10,414,649 51,156,209Page 37
Statement of Object Classification Wise Expenditure (Schedule III)
Rs. In million
Budget Revised Budget
Object
Description Estimates Estimates Estimates
Code
2025-26 2025-26 2026-27
A01 Total Employees Related Expenses 1,438,843 1,454,913 1,608,289
A011 Pay 247,602 249,171 253,090
A011-1 Pay of Officer 81,592 83,234 85,757
A011-2 Pay of Other Staff 166,009 165,936 167,333
A012 Allowances 1,191,241 1,205,743 1,355,198
A012-1 Regular Allowances 1,147,312 1,154,803 1,305,510
A012-2 Other Allowances (Excluding TA) 43,929 50,939 49,688
A02 Project Pre-investment Analysis 2,720 1,976 2,399
A03 Operating Expenses 1,782,380 1,806,184 2,008,258
A04 Employees Retirement Benefits 1,065,034 1,064,592 1,176,179
A05 Grants, Subsidies & Write off Loans 3,103,344 2,709,803 3,739,676
A06 Transfers 16,982 148,515 20,192
A07 Interest Payment 8,207,255 6,937,464 8,054,005
A08 Loans and Advances 1,238,381 1,206,436 1,050,605
A09 Physical Assets 720,174 718,256 971,378
A10 Principal Repayments of Loans 19,679,231 30,140,505 31,958,778
A11 Investments 187,091 294,445 100,234
A12 Civil Works 390,294 409,035 438,754
A13 Repairs and Maintenance 23,573 28,525 27,463
TOTAL EXPENDITURE 37,855,301 46,920,650 51,156,209Page 38
Statement of Contingent Liabilities of the Federal Government 1. Contingent liabilities of Pakistan are primarily comprise of guarantees issued on behalf of Public Sector Enterprises (PSEs). The sovereign guarantees are normally extended to enhance the financial viability of projects and activities undertaken by government entities which generate significant social and economic benefits. Such guarantees enable public sector entities to access finances at lower costs or on more favourable terms and in certain cases, fulfil requirements where a sovereign guarantee is a precondition for concessional finances from bilateral and multilateral agencies to sub-sovereign borrowers. 2. The volume of new government guarantees issued during a financial year is limited under the Fiscal Responsibility and Debt Limitation Act, 2005 (as amended to date) which stipulates that the Government shall not issue guarantees aggregating to an amount exceeding two percent of the GDP in any financial year, including those relating to rupee lending, rate of return, outright purchase agreements, and other claims and commitments, provided that the renewal of existing guarantees shall be treated as issuance of a new guarantee. 3. During July-March FY2026, the Government issued fresh rollover guarantees aggregating to PKR 769 billion, equivalent to 0.61 percent of estimated GDP. The outstanding stock of guarantees stood PKR 4,322 billion as of end-March 2026. This amount also includes guarantees issued for commodity operations undertaken by Federal Government SOEs namely Trading Corporation of Pakistan (TCP) and Pakistan Agriculture Storage & Services Corporation (PASSCO), which amounted to PKR 895 billion as of end March-2026.
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Table-1: Summary of Outstanding Government Guarantees (Rs in billion)
Outstanding Guarantees Total Guarantees
Domestic 2,259 2,395
External 2,063 2,075
Total 4,322 4,470
Memo:
External (US$ in million) 7,391 7,435
Exchange Rate (Pak Rupee/US Dollar) 279.1 279.1
4. Sector, entity and interest rate wise share of the guarantees as of end March
2026 are as follows:
Table 2: Outstanding Position of GoP Guarantees
Rs in billion % age
Sector Wise Breakup
Total Outstanding Stock 4,322 100%
- Power Sector 2,426 56%
- Commodities Operations Financing 895 21%
- Aviation 269 6%
- Financial 166 4%
- Others 567 13%
Entity Wise Breakup
Total Outstanding Stock 4,322 100%
- PAEC 1,562 36%
- CPPA-G 660 15%
- PASSCO 528 12%
- TCP 366 8%
- Others 1,206 28%
Interest Rate Type
Total Outstanding Stock 4,322 100%
- Floating Rate 2,216 51%
- Fixed Rate 2,106 49%
Note: The original maturities of major portion of Guaranteed Debt Stock were 5 years and
abovePage 40
5. The estimates of guarantees to be issued from April 2026 till June
2027 are as follows:
Table 3: Estimated Guarantees Issuance and Position (Q4 FY 26 and FY 27)
(Rs in billion)
A Opening Guaranteed Debt Position (31-03-2026) 4,322
B New Guarantees to be Issued (Q4 FY26 & FY27) 907
- REKO DIQ 223
- ML 3 Rail Project 113
- C-5 Power Project 221
- PPP Projects 90
- WAPDA 50
- NGC 19
- PSO 50
- Credit Guarantee Schemes 80
- Exim Bank 10
- Misc/Contingencies 50
C Estimated Repayments against existing Guaranteed Loans 224
D=B-C Net Issuance of Guarantees (Q4 FY26 & FY27) 683
A+D Estimated Closing Guaranteed Debt Position (30-06-2027) 5,005
Note
(i) Expected external guarantees are converted into PKR at exchange rate of 290
(ii) The estimates are developed based on requests received from different PSEs and
issuing wings during the ongoing Fiscal Year. This amount excludes roll-overs
(iii) The guarantees of which LoCs have already been issued before March 2026 are
incorporated in Opening Guaranteed Debt Position as at End March 2026
(iv) Opening Stock includes guarantees issued for Commodity Operations by TCP &
PASSCO which was mentioned separately in previous statementsPage 41
Statement of Fiscal Risks 1. INTRODUCTION The Statement of Fiscal Risks FY2026-27 provides a comprehensive assessment of key risks that could affect Pakistan’s fiscal outlook. It covers macroeconomic, revenue, debt, SOE, climate change, natural disasters, commodity financing and global price shocks. In comparison to the FY 2025-26 budget estimates, the quantified deviations are presented as percentage points of GDP. By estimating the potential fiscal impact of these risks, it also proposes mitigation measures to support fiscal discipline, strengthen risk management, and enhance the resilience of public finances. ANALYSIS OF FISCAL RISKS MACROECONOMIC RISKS Macroeconomic risks mainly arise from a slowdown in economic activity, which could lead to weaker-than-expected real GDP growth and affect the fiscal stance. A 1 percentage point decline in real GDP growth could lower government revenues through reduced tax collections, while also increasing expenditure pressures, particularly on social safety nets. The combined impact is estimated to widen the fiscal deficit by around 0.2 percent of GDP in FY2026-27. Under this scenario, upward pressure on inflation and exchange rate depreciation could further strain public finances. REVENUE-RELATED RISKS Revenue collection remains exposed to lower tax elasticity, slowdown in economic activity, shortfalls in non-tax receipts, and structural challenges in reducing the tax gap. The FY2026-27 revenue projections are based on continued administrative reforms, rationalization of tax structures, and expansion of the tax base. However, if tax revenue grows lower than expected, for instance, 10 percent
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lower than budget estimates, it could result in a reduction of 0.7 percent of GDP from the budget estimates in FY 2026-27. Revenue risks may also arise from a 30 percent decline in SBP surplus profits, which could increase the deficit by around 0.3 percent of GDP in FY 2026-27. Similarly, a 20 percent shortfall in petroleum levy collection could add 0.2 percent of GDP to the fiscal deficit in FY 2026-27. Moreover, tax expenditures remain a significant structural revenue risk as expanded exemptions and concessions could widen the fiscal deficit by 1.3 percent of GDP in FY 2026-27 estimates. DEBT-RELATED FISCAL RISKS Debt servicing costs represent a significant fiscal vulnerability, as the debt portfolio remains exposed to interest rate movements, exchange rate depreciation, and refinancing pressures. A 200-basis point increase in domestic interest rates and a 100-basis point rise in external interest rates could raise interest payments beyond budgeted estimate, widening the fiscal deficit by an estimated 0.4 percent of GDP. Exchange rate depreciation could also increase the rupee cost of external debt servicing, although its impact on the FY2026-27 fiscal deficit is expected to remain relatively limited due to stable exchange rate. Refinancing risks may further increase if there is greater reliance on short-term instruments, which could weaken the debt maturity profile, raise rollover requirements, and expose the budget to higher interest rate volatility. Under this scenario, the fiscal deficit could increase by around 0.8 percent of GDP compared to FY2026-27 budget estimates. STATE-OWNED ENTERPRISES RELATED FISCAL RISKS State-Owned Enterprises pose fiscal risks through lower dividend payments and higher government financial support to loss-making entities. Structural inefficiencies, weak governance, and the burden of public service obligations continue to affect SOE profitability and may reduce their net earnings. A 6.0 percent shortfall in SOE dividend payments is estimated to widen the fiscal
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deficit by around 0.02 percent of GDP against the FY2026-27 target. However, substantial fiscal risk may arise from increased government financial support to SOEs. Under this scenario, if financial support reaches 1.5 percent of GDP, it could increase the fiscal deficit by around 0.4 percent of GDP relative to FY2026- 27 estimates. Henceforth, while lower dividend payments may have a modest direct fiscal impact, continued support for loss-making SOEs could create significant pressure on the fiscal position. CLIMATE CHANGE-RELATED FISCAL RISKS The fiscal impact of climate change varies across mitigation and high-emission scenarios. Under RCP 2.6, which represents an ideal mitigation pathway, higher spending on green infrastructure, climate adaptation, and mitigation measures could raise the fiscal deficit by around 0.2 percent of GDP relative to the FY2026-27 budget baseline. However, these investments are expected to support economic activity and strengthen climate resilience over the medium term, particularly if backed by private-sector participation and international climate financing. In contrast, under RCP 8.5, which reflects a high-emission and adverse climate pathway, the near-term fiscal impact is estimated to remain limited, increasing the fiscal deficit by around 0.01 percent of GDP in FY2027. However, this risk could rise significantly over the medium term if climate-related shocks become more frequent and severe, leading to higher infrastructure damage, emergency spending, agricultural losses, and weaker revenue collection. These projections suggest that climate risks may appear modest in the short run, but could create a growing fiscal burden if adaptation, mitigation, and climate financing efforts remain insufficient. NATURAL DISASTERS RELATED FISCAL RISKS Natural disasters remain one of the largest fiscal risks, given Pakistan's exposure to floods, droughts, heatwaves, and other climate-related shocks. These events frequently cause unexpected fiscal pressures, necessitating immediate, unbudgeted expenditure for emergency relief. Without dedicated disaster risk financing
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mechanisms, an average disaster event could increase the fiscal deficit to 1.5 percent of GDP, constituting the largest deviation among all identified fiscal risks. However, with disaster risk financing, the fiscal outlook changes. Under this scenario, the fiscal deficit for FY2026-27 will increase by 0.4 percent of GDP. OTHER FISCAL RISKS COMMODITY FINANCING OPERATIONS AND FISCAL RISK The Federal Government faces significant fiscal exposure arising from guarantees issued to provincial governments and Public Sector Enterprises for commodity financing operations. Assuming a 25 percent probability of guarantees' actualization, the federal fiscal deficit could increase by 0.1 percent of GDP in FY2026-27. GLOBAL COMMODITY PRICE SHOCK AND FISCAL RISK Statement of Fiscal Risk identifies significant fiscal vulnerabilities associated with a potential rise in global oil prices particularly in the context of current Middle East conflict, which may likely result in contraction of petroleum levy receipts and an increase in energy-related subsidies. An international oil price shock during FY 2026-27 with a likely decision to waive full price pass-through to domestic consumers would result in a decline in petroleum levy receipts. At the same time, to protect domestic consumers, particularly low-income households, the Government would need to raise subsidies. Rising international oil prices, specifically a $40 per barrel increase, are projected to add 0.8 percent of GDP to the fiscal deficit in FY 2026-27. 2. FISCAL RISK MITIGATION STRATEGIES The Government's fiscal-risk mitigation strategy is based on four pillars: maintaining a credible macro-fiscal framework, strengthening revenue mobilization and expenditure discipline, reducing contingent liabilities, and building fiscal buffers against shocks. Immediate priorities include protecting the primary surplus, improving tax compliance, rationalizing untargeted subsidies, strengthening debt management, and enhancing monitoring of SOEs, guarantees,
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commodity operations, and climate-related fiscal exposures. To mitigate revenue-related fiscal risks, the Government has established a dedicated tax policy function while strengthening tax administration, risk-based enforcement, and digital integration. Over the medium term, reforms prioritize broadening the tax base, rationalizing exemptions, and enhancing economic documentation. Furthermore, policy design focuses on simplifying procedures and safeguarding petroleum levy and non-tax revenue through increased transparency and inter-provincial coordination. The financial performance of the SOE portfolio is improving through rigorous performance-based contracts and the accelerated privatization or liquidation of non-strategic, loss-making entities. These measures are expected to mitigate the recurring flow of liabilities that currently challenge medium-term fiscal targets. Further, the gap between climate action underscores that investing in green projects is not merely an environmental consideration but a critical strategy for resilience and prudent fiscal management. This Statement of Fiscal Risks provides policymakers and stakeholders with a clear, quantified view of key fiscal vulnerabilities that could affect the fiscal outlook over the medium term. It recognizes uncertainties in economic conditions and external shocks, while proposing proactive, cross-sectoral actions to enhance fiscal resilience, improve transparency, and maintain macro-fiscal stability and ongoing challenges.
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STATEMENT OF ESTIMATED TAX EXPENDITURE
Section 8 of the Public Finance Management Act, 2019 provides that the
Federal Government shall, in respect of every financial year cause to be laid before
the National Assembly, Finance Bill consistent with Article 73 of the Constitution
including a statement of estimated tax expenditure of the Federal Government.
2. Tax Expenditure Report 2026 providing the details of tax expenditure in
FY2024-25 which involves tax expenditure of Sales Tax of Rs. 1,273.97 billion, a
tax expenditure of Income Tax of Rs. 579.69 billion, and a tax expenditure of
Customs Duty of Rs. 499.13 billion, arriving at a total estimated tax expenditure of
Rs. 2,352.8 billion, is being laid before the Parliament.
(Rashid Mahmood)
Chairman FBR/ Secretary
Revenue Division
Dated: 12th June, 2026Page 47
Medium-Term Budgetary Statement
(FY2026-27 to FY2028-29)
Federal Government presents the Medium-Term Budgetary Statement as part
of the Annual Budget Statement in accordance with Section 5 of the Fiscal
Responsibility and Debt Limitation Act, 2005 (as amended to date). The Statement
describes the Government’s medium-term fiscal strategy aimed at preserving
macroeconomic stability, strengthening fiscal sustainability, reducing public debt
vulnerabilities, and fostering sustainable and inclusive economic growth.
In FY2025-26, Pakistan's economy made significant progress towards
stabilization, with focus shifting to growth led through export and taxation reforms.
Improvements in economic activity, external sector stability, fiscal performance, and
investor confidence have strengthened the foundations for higher and more
sustainable growth. Building on these gains, the Government remains committed to
advancing reforms that enhance productivity, competitiveness, exports, investment,
digital transformation, and private sector-led growth over the medium term.
Fiscal policy over the medium term will remain anchored in the principles of
sustainability, efficiency, and transparency. The Government will continue pursuing
fiscal consolidation through sustained revenue mobilization, expenditure
rationalization, and strengthened public financial management. Tax policy and
administration reforms, including broadening of the tax base, digitalization of tax
processes, enhanced compliance measures, and modernization of revenue
administration, are expected to strengthen domestic resource mobilization and create
fiscal space for priority expenditures while maintaining a primary surplus and a
declining fiscal deficit trajectory.Page 48
On the expenditure side, the Government will continue to prioritize
allocations that support human development, social protection, economic growth,
and national resilience. Special emphasis has been placed on education, health,
poverty alleviation, youth development, and gender-responsive interventions. To
improve access to healthcare services, an additional allocation of Rs. 1 billion has
been provided in FY2026-27 for the provision of free medicines in Federal
Government hospitals. Enhanced grant allocations have also been made to the
Higher Education Commission to support higher education and research, while
funding for the Benazir Income Support Programme (BISP) has been strengthened to
protect vulnerable segments of society and promote social inclusion.
The Government remains committed to maintaining adequate investment in
development priorities through the Public Sector Development Programme, with a
focus on infrastructure, water resources, energy, information technology, climate
resilience, and productive sectors of the economy. At the same time, expenditure
efficiency will be enhanced through continued austerity measures, rightsizing of
government functions, pension reforms, improved public investment management,
and outcome-oriented budgeting.
Recognizing the growing fiscal implications of climate change and natural
disasters, the Government is strengthening climate-responsive budgeting and
disaster-risk management within the medium-term fiscal framework. Ongoing
reforms have been designed to integrate AI into public finance management through
development of an AI-enabled digital infrastructure for climate budgeting in Pakistan.
This will improve the overall efficiency of the tagging process, transparency,
resource allocation, and monitoring of climate-related expenditures. These initiatives
are expected to strengthen fiscal resilience while supporting Pakistan’s climate
adaptation and sustainability objectives.Page 49
Over the medium term, the Government will continue to pursue prudent debt management policies aimed at reducing fiscal vulnerabilities, extending debt maturities, diversifying financing sources, and containing debt-servicing costs. Supported by continued structural reforms, improved fiscal governance, and responsible macroeconomic management, the medium-term budgetary framework seeks to balance the objectives of economic growth, social protection, development, and fiscal sustainability, thereby laying the foundation for a more resilient and prosperous economy.
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Climate Budget Statement Climate change continues to pose significant economic, fiscal, environmental, and social challenges to Pakistan, requiring sustained policy attention and resource allocation. Recognizing the macro-fiscal implications of climate and disaster-related risks, the Federal Government has adopted climate budgeting as a governance mechanism to mainstream climate considerations into planning, budgeting, implementation, monitoring, and reporting across federal ministries, divisions, and departments. This approach supports informed decision-making and strengthens the integration of climate priorities into public financial management systems. Climate Budget Tagging (CBT) has been institutionalized to identify, track, and report climate-responsive expenditures in accordance with national climate policy priorities. Through a consultative process involving relevant stakeholders, more than 5,000 cost centres have been mapped within the SAP system under adaptation, mitigation, and other supporting climate-related categories. The Government has further strengthened the climate budgeting framework through the operationalization of a comprehensive Climate Budget Governance System, enabling more systematic monitoring and reporting of climate-related public expenditures. As part of the Budget Call Circular, Green Budgeting has been introduced as an integral component of fiscal risk management. Ministries, divisions, and departments are required to identify and report expenditures related to climate action, environmental protection, renewable energy, sustainable agriculture, biodiversity conservation, disaster preparedness, and other green economy initiatives. In addition, disaster budget tagging has been introduced to improve the identification and reporting of disaster-related expenditures and strengthen fiscal preparedness against natural and climate-induced disasters.
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The scope of climate budgeting has also been expanded beyond expenditure. Climate tagging has been extended to subsidies, grants, and climate-relevant revenues to provide a more comprehensive assessment of climate-related fiscal interventions. These measures will facilitate improved monitoring of climate-responsive spending and revenue measures and support evidence-based policy formulation. To further advance these reforms, Finance Division has developed an AI-enabled digital infrastructure for climate budgeting comprising climate budget tracking, AI- assisted climate budget tagging, and digitized reporting mechanisms. An integrated dashboard, linked with SAP, will enable ministries, divisions, and departments to submit climate-related information through AI-supported digital forms and access analytical reports, thereby improving the quality, consistency, transparency, and accessibility of climate budget information. For FY2026-27, climate-responsive allocations constitute 1 percent of the current budget and 11 percent of the development budget. At least 44% of subsidies are favorably climate-responsive either directly or indirectly. These allocations reflect the Government's continued commitment to strengthening climate resilience, supporting mitigation efforts, managing disaster-related fiscal risks, and promoting sustainable and green economic development through targeted fiscal interventions.
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Gender Budget Statement Article 25 of the Constitution of the Islamic Republic of Pakistan, 1973 provides for equality of all citizens before the law and prohibits discrimination on the basis of sex, while Article 34 directs the State to ensure full participation of women in all spheres of national life. In line with these constitutional provisions, the Federal Government remains committed to reducing gender disparities and promoting inclusive development through gender-responsive budgeting. Gender inequality continues to remain a structural challenge, with gaps observed across key development indicators including education, health, employment, economic participation, and access to opportunities. Addressing these disparities is essential not only for ensuring social equity but also for realizing the full economic potential of the country. In this context, gender-responsive public financial management has been strengthened as an integral part of budget formulation and policy planning. A key constraint in advancing gender-sensitive policy-making is the availability and quality of gender-disaggregated data. To address this gap, the Federal Government has institutionalized gender budget tagging to identify, classify, and monitor gender- relevant public expenditure across ministries, divisions, and departments. More than 5,000 cost centres of the federal budget have been mapped under six major gender classifications, including: (i) equality and quality in education, (ii) health and well- being, (iii) governance and data systems, (iv) employment and economic opportunity, (v) safety and security, and (vi) agency, political participation and meaningful engagement. This framework enables improved tracking of gender-sensitive allocations and supports evidence-based policy formulation.
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Gender-responsive budgeting also contributes to monitoring progress on cross- cutting Sustainable Development Goals (SDGs), particularly in areas such as education, health, nutrition, and social inclusion. It strengthens transparency in public expenditure by enabling policymakers to assess the gender impact of government programs and initiatives more effectively. For FY2026-27, gender-responsive allocations constitute 9% percent of the current budget and 8% percent of the development budget. These allocations reflect the Government’s continued commitment to promoting gender equality, improving women’s access to education, health, and economic opportunities, and strengthening institutional mechanisms for gender mainstreaming across public sector programs and projects.
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Disaster Budget Statement Disaster risk in Pakistan is shaped by a combination of extreme natural events and underlying vulnerabilities, which are further exacerbated by the impacts of climate change. Owing to its diverse geography and evolving climatic patterns, Pakistan remains highly exposed to multiple forms of natural disasters. In response to these challenges, the Government of Pakistan has established a comprehensive institutional and legal framework for disaster risk management, including the enactment of relevant laws, establishment of disaster management authorities at the federal and provincial levels, and creation of dedicated disaster risk management funds. These measures aim to strengthen preparedness, improve response mechanisms, and enhance recovery and reconstruction capacity. Recognizing the need for improved fiscal transparency and evidence-based policy- making, the Federal Government has institutionalized disaster budget tagging as part of public financial management reforms. This initiative enables systematic identification, classification, and tracking of disaster-related expenditures across federal ministries, divisions, and departments. More than 5,000 cost centres have been mapped under four major disaster classifications, namely Disaster Preparedness, Disaster Response, Recovery & Rehabilitation, and Reconstruction. Building upon this framework, the Budget Call Circular for FY2026-27 has further strengthened disaster-responsive budgeting through the introduction of a structured classification system. This includes standardized coding of disaster-related expenditures (DRPPS, DRRSE, DRRRN, and DRRCN) and categorization of activities based on their relevance to the National Disaster Management Plan. Expenditures are assessed according to defined weighting groups reflecting their
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direct or indirect contribution to disaster risk reduction, preparedness, response, recovery, and reconstruction outcomes. This enhanced framework improves consistency in reporting, strengthens inter- agency coordination, and enables better alignment of public spending with disaster risk management priorities. It also supports improved monitoring and evaluation of fiscal resources allocated for disaster resilience and recovery. For FY2026-27, disaster-responsive allocations constitute 4% percent of the current and 0.04% of development budget. These allocations reflect the Government’s continued commitment to strengthening disaster preparedness, improving emergency response systems, and enhancing recovery and reconstruction capacity in order to reduce the human and economic impact of natural disasters.
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Government of Pakistan
Finance Division
STATEMENT OF RESPONSIBILITY
Stated that all policy decisions with material economic or fiscal implications
that the Federal Government has made before 12 th June 2026, the day on which
the contents of the economic policy statements were finalized and all other
circumstances with material economic or fiscal implications of which I was aware
before that day, have been communicated to the Secretary of Finance in terms of
Section 10(1)(a) of Fiscal Responsibility and Debt Limitation Act, 2005 (as amended
to date).
The statement to the best of my knowledge provides for: -
a. The integrity of the disclosures contained in the economic
policy statement;
b. the consistency with requirements of the Act of the
information contained in the economic policy statements; and
the omission from the economic policy statement of any c.
decision or circumstance specified in sub-section (3) of section
8 of the Act.
(Muhammad Aurangzeb)
Minister for Finance and RevenuePage 57
Government of Pakistan
Finance Division
STATEMENT OF RESPONSIBILITY
Stated that the Finance Division, in terms of Section 10(1)(b) of Fiscal
Responsibility and Debt Limitation Act, 2005 (as amended to date), has supplied
to the Minister for Finance and Revenue, using its best professional judgment on
the basis of economic and fiscal information available to it before 1 2 th June
2026, the day on which the contents of the economic policy statements were
finalized, an economic and fiscal statement incorporating the fiscal and economic
implications of those decisions and circumstances, but any decisions or
circumstances that the Minister for Finance and Revenue has determined under Sub-
section (3) of Section 8 of the Fiscal Responsibility and Debt Limitation Act 2005
(as amended to date) have not been incorporated in the statement.
IMDAD ULLAH BOSAL
Secretary to the Government of Pakistan
Finance Division
Islamabad, the 12th June, 2026