Pakistan’s development budget has been significantly affected by IMF programme conditions, with a major shortfall reported in the utilization of allocated development funds.
According to a working paper presented before the Annual Plan Coordination Committee meeting chaired by Planning Minister Ahsan Iqbal, only Rs 528 billion out of the Rs 1 trillion allocated under the Public Sector Development Programme has been utilized so far.
The document stated that the government had allocated Rs 1 trillion for development projects during fiscal year 2025-26, but ministries, divisions, and administrative bodies spent only Rs 528 billion between July 2025 and May 25, 2026.
Addressing the meeting, Federal Minister for Planning Ahsan Iqbal said resources available for development projects in Pakistan have been steadily declining, while investment has fallen from 2.6 percent of GDP to just 0.6 percent.
He said development projects worth around Rs 5 trillion are currently under planning and approval stages, while approximately Rs 10 trillion will be required to complete them.
According to Ahsan Iqbal, resources for development projects have continued to decline since fiscal year 2018, whereas provinces have become financially stronger due to increases in their development budgets.
The minister revealed that ministries had requested Rs 3 trillion for development projects in the upcoming fiscal year, but the federal development programme remains capped at Rs 1 trillion.
He added that due to limited resources, only selected and priority projects will be pursued during the next fiscal year.
