Islamabad, June 4, 2025: In a key step towards shaping Pakistan’s economic future, the National Economic Council (NEC), chaired by Prime Minister Shehbaz Sharif, has approved a Rs1,000 billion development outlay for the fiscal year 2025–26.
The high-level meeting was attended by the chief ministers of all four provinces and senior federal government officials. A range of crucial economic decisions were finalized, including setting the Gross Domestic Product (GDP) growth target at 4.2% for the upcoming fiscal year.
According to sources from the Planning Commission, the NEC approved a revised funding allocation for the N-25 highway project in Balochistan. The initially proposed Rs120 billion package was scaled back to Rs100 billion, reflecting a broader strategy to reallocate resources based on evolving priorities.
As part of its macroeconomic planning, the NEC also endorsed a national export target of $35 billion. The council reviewed and approved key components of the Public Sector Development Programme (PSDP) and broader national development plans. Sector-specific performance targets for agriculture, industry, and services were also aligned with the fiscal objectives for 2025–26.
Prior to the NEC session, Prime Minister Sharif held separate consultations with each provincial chief minister to build consensus and ensure coordinated economic planning across the federation.
The approved development budget signals the government’s continued focus on infrastructure expansion and economic revitalization, while also indicating a shift in certain project allocations due to fiscal constraints and policy adjustments.
Meanwhile, reports suggest that the federal budget for 2025–26 is likely to be presented on June 10, with an estimated size of Rs17.8 trillion—approximately Rs900 billion less than the current fiscal year’s Rs18.7 trillion budget.
The upcoming budget is expected to incorporate substantial austerity measures. A major anticipated relief comes from the recent decline in the policy rate, which could reduce the government’s expenditure on interest payments by an estimated Rs1,300 billion.
With fiscal discipline and growth-oriented spending at the core of its strategy, the government aims to strike a balance between economic recovery and budgetary prudence in the 2025–26 financial year.
