Pakistan has unveiled the Federal Budget 2025-26, setting the total budget size at Rs 17,573 billion. Key allocations include Rs2,550 billion for defense and Rs 8,207 billion for interest payments on loans, according to budget documents.
The budget allocates Rs2,550 billion to the defense sector, showing an approximately 19% increase from last year, reflecting the government’s commitment to maintaining national security amid regional challenges. Last fiscal year, the budgetary allocation for the defence sector was over Rs2.1 trillion.
A significant portion, Rs8,207 billion, has been earmarked for interest payments on loans, underscoring the burden of debt servicing on the national exchequer. Additionally, Rs8,206 billion will be transferred to the provinces to support regional development and governance.
The government estimates total revenue for the fiscal year at Rs19,278 billion. This includes a non-tax revenue target of Rs5,147 billion and a tax revenue target of Rs14,131 billion set for the Federal Board of Revenue (FBR). These ambitious targets highlight the government’s focus on boosting revenue collection to fund public services and development projects.
