Islamabad, June 12, 2026: Prime Minister Shehbaz Sharif on Friday underscored the importance of national security, economic stability, and strategic investments in water and energy sectors as the federal cabinet approved the Budget 2026-27 ahead of its presentation in Parliament.
Addressing a cabinet meeting, the prime minister noted that the government was presenting its third budget amid significant economic and security challenges.
“Today, we are presenting the third budget of our government. There were undoubtedly many challenges in preparing this budget. No nation can effectively manage its affairs, let alone achieve progress, unless its security is strong and invincible,” he said.
The premier emphasized the need for long-term investments in critical sectors, including water storage and indigenous energy resources.
“We have to build water reservoirs and dams and accelerate work on local energy resources, including solar power, wind energy and battery technologies,” he stated.
Prime Minister Shehbaz said the budget would include measures aimed at providing tax relief and promoting economic growth. He revealed that the government held extensive consultations with the International Monetary Fund (IMF) during the budget-making process and that he personally spoke with IMF Managing Director Kristalina Georgieva, who appreciated Pakistan’s recent economic progress.
The prime minister also highlighted broad political consensus achieved during the budget consultations. He said the Pakistan Muslim League-Nawaz (PML-N) held detailed and productive discussions with its coalition partner, the Pakistan Peoples Party (PPP), while other allied parties also extended their full support.
He noted that the federal government remained engaged in extensive consultations with all four provinces over the past six weeks to secure additional fiscal space for national priorities.
According to the prime minister, the federal and provincial governments agreed to contain development and non-development expenditures across the federation to create greater fiscal room for strategic national needs in the coming years.
Shehbaz Sharif praised PML-N President Nawaz Sharif and Punjab Chief Minister Maryam Nawaz for supporting the federal government’s requirements related to defence and water security. He also acknowledged the cooperation of Sindh’s leadership, thanking President Asif Ali Zardari and PPP Chairman Bilawal Bhutto-Zardari for prioritizing national interests.
The prime minister further appreciated Balochistan Chief Minister Sarfraz Bugti and Khyber Pakhtunkhwa Chief Minister Sohail Afridi for their constructive engagement, describing the collective approach as a powerful demonstration of national unity and cohesion.
Reflecting on the government’s economic journey, PM Shehbaz acknowledged that difficult fiscal decisions, including additional taxation in previous budgets, had been necessary to stabilize the economy and meet IMF commitments.
“Despite our best efforts, taxes had to be imposed in the past two budgets to stabilize the economy and create opportunities for growth. The people of Pakistan endured inflation with patience, and I thank them on behalf of the government and the cabinet,” he said.
The prime minister highlighted key economic improvements over the past two years, noting that inflation had fallen from around 38 percent to single digits, while the policy interest rate had declined from 22.5 percent to 11 percent before recent regional tensions created fresh economic pressures.
He expressed confidence that the new budget would help accelerate economic growth, provided all stakeholders continue to work collectively for national development.
“Our economy is now stable. With this third budget, we hope the wheels of the economy will move faster, provided we work tirelessly and fulfill our responsibilities with dedication,” he said.
At the start of his address, the prime minister also paid tribute to security personnel who recently lost their lives in the line of duty. Recalling his attendance at their funeral prayers, he described the scene as deeply emotional and extended condolences to the bereaved families.
