Sara Khalid
He budget focuses on economic stability and growth through fiscal consolidation, private sector revitalization, and improved public delivery. Include a stable minimum wage of 37,000 and measures to enhance agricultural and industrial productivity.
The budget size has increased over the years, 000s of billions of rupees, with the 2025-26 budget pegged at Rs17.57 trillion, slightly down from Rs18.9 trillion in 2024-25.Debt servicing continues to dominate the budget, with Rs8.207 trillion allocated for debt servicing in 2025-26, consuming more than half of the total outlay .Defense spending has increased by 20% to Rs2.55 trillion in 2025-26, while development spending is up 11.4% to Rs4.22 trillion.
Revenue Generation; The Federal Board of Revenue (FBR) has set an ambitious tax revenue target of Rs14.13 trillion for 2025-26, a 9% increase from the previous year. Non –tax revenue is expected to contribute Rs5.15 trillion to the budget.
Economic Growth and Challenges; The budget aims to achieve a GDP growth rate of 4.2%in 2025-26 up from 3.6% in 2024-2025.However, the budget has faced criticism for imposing taxes on essential items, which could make them unaffordable for the general public ,particularly the middle class.
Key sectors;
Energy ; Rs90.2 billion allocated for energy sector development.
Agriculture; Rs133 billion allocated for agriculture sector development.
Education; Rs14.3 billion allocated for health sector development.
Conclusion;
The Federal Budget 2025 -26 shows clear intent to pursue fiscal consolidation through revenue enhancement and controlled expenditures however heavy interest payments and underinvestment in human development remain key bottlenecks. If Pakistan is to break the cycle of debt and underdevelopment it must prioritize structural reform, broaden the tax base, and focus on people centric growth
