The federal government’s budget schedule has come under uncertainty after the National Economic Council (NEC) meeting, planned for tomorrow under the chairmanship of Prime Minister Shehbaz Sharif, was postponed.
Officials say the delay has also raised questions over whether the federal budget, earlier expected on June 5, will now be presented on time. Sources suggest the budget could instead be tabled on June 8 or June 12, though no final decision has been taken.
The National Assembly and Senate are still scheduled to meet in Islamabad on June 5 for budget-related proceedings, with the lower house session set for 5pm and the upper house meeting at 6pm, according to an official statement from the President House. The government aims to complete all budget discussions and pass the financial plan by June 24, in line with constitutional requirements that require approval before June 30.
Despite the shifting timetable, the upcoming budget for the financial year 2026-27 is expected to remain heavily focused on fiscal discipline, taxation and enforcement, as Pakistan continues to align its economic policies with the International Monetary Fund (IMF) programme.
IMF-linked priorities shaping budget direction
Analysts say the budget is being framed under tight IMF conditions, with Pakistan targeting a primary surplus of 2 percent of GDP in FY27. This is expected to keep spending under control while expanding the tax base through stricter enforcement and new measures.
The IMF projects Pakistan’s economy to grow by 3.5 percent in FY27, with inflation averaging 8.4 percent. It also estimates federal tax revenue at Rs17.144 trillion, including Rs15.264 trillion in Federal Board of Revenue collections.
At the same time, social spending requirements remain significant, with floors set at Rs815 billion for cash transfers under the Benazir Income Support Programme and over Rs4.2 trillion for health and education.
Development budget crosses Rs1.1 trillion mark
Budget documents indicate that the federal development programme for FY2026-27 is proposed at over Rs1.1 trillion.
Out of this, Rs754.9 billion has been earmarked for federal ministries. The Ministry of Water Resources tops the list with a proposed allocation of Rs179 billion, followed by Rs72 billion under the Cabinet Division for development schemes linked to parliamentarians.
Other key allocations include Rs91 billion for power projects, Rs27.83 billion for railways, Rs20 billion for information technology and telecom, and Rs16 billion for the Interior Ministry.
For education, Rs36 billion has been proposed for the Federal Education Ministry, while the Higher Education Commission is expected to receive Rs41.19 billion. The Ministry of Information is set for Rs4 billion, and the Board of Investment Rs805 million.
A major portion, Rs355 billion, is proposed for state-owned corporations, including Rs264 billion for the National Highway Authority alone. Provinces and special areas are expected to receive Rs251.68 billion.
Growth outlook balanced with fiscal pressure
While the macroeconomic picture has improved compared to last year, experts warn that fiscal space remains limited. Stronger growth and stabilising indicators have not eased the pressure to meet IMF-backed targets.
Analysts expect the government to rely more on indirect taxation, higher petroleum levies and stricter enforcement against non-filers to meet revenue goals. Some also caution that such measures could push up inflation, particularly through fuel costs that affect transport and food prices.
At the same time, calls are growing for targeted relief measures, including possible adjustments in corporate taxation and incentives for export-oriented sectors, though expectations of broad-based relief remain limited.
With the budget timeline now uncertain and policy choices tightly constrained, attention is focused on how the government balances growth needs with fiscal consolidation in the coming weeks.
