Islamabad, June 9, 2025: The federal government will unveil the Budget for the fiscal year 2025-26 tomorrow, with a strong focus on development across key sectors, including defense, infrastructure, technology, and public services.
A total of Rs11.55 billion has been earmarked for the Ministry of Defense, covering 22 ongoing development projects to be carried forward into the new fiscal year. Key allocations include:
- Rs4 billion for the completion of the New Gwadar International Airport
- Rs2.89 billion for advancements under the Hydro-Met innovation project
- Rs200 million for constructing the Kasana Dam to supply water to Islamabad Airport
- Rs125 million for installing weather monitoring radars in Multan and Sukkur
- Rs130 million for acquiring drones and supporting environmental pollution control
Additional allocations under the defense development plan include Rs16 million for upgrading the Airport Security Force (ASF) Academy in Karachi and Rs100 million for building ASF residential units at Faisalabad Airport.
The government is prioritizing technological advancement, setting aside Rs2.8 billion for the application of artificial intelligence in the agriculture and aerospace sectors. A further Rs1.93 billion has been proposed for establishing a new National University in Islamabad.
While no new schemes have been introduced for the Ministry of Housing, Rs2.3 billion will fund 21 ongoing projects. Other notable allocations include:
- Rs65 million for renovating the Prime Minister’s Office
- Rs55 million for developing the Prime Minister’s Staff Colony
- Rs110 million for the construction and renovation of various government buildings in Islamabad
- Rs130 million for 12 new apartments in the Ministers’ Enclave
- Rs50 million for installing new lifts at Shaheed Millat Secretariat
In Sindh, the Green Line BRT project in Karachi will receive Rs500 million, while Rs80 million are allocated for development projects in Hyderabad and Mirpurkhas under the Prime Minister’s Development Program.
The Ministry of Information Technology will see a significant reduction of Rs10.4 billion in its development budget compared to last year, now standing at Rs13.52 billion. While no new IT projects are being launched, key investments include:
- Rs4.91 billion for a technology park in Islamabad
- Rs4 billion for an IT park in Karachi
- Rs1.97 billion for projects promoting the digital economy
- Rs50 million each for IT startups and specialized IT training
- Rs50 million to enhance mobile services in Azad Kashmir and Gilgit-Baltistan
In the health sector, the government has allocated:
- Rs97.1 million for the “One Patient, One ID” digital health initiative
- Rs250 million for cybersecurity and the protection of Digital Pakistan infrastructure
In a key tax reform move, the government is planning to offer relief from the super tax for large businesses. According to sources:
- Companies earning up to Rs150 million annually will remain exempt from super tax
- For companies earning Rs200 million, the rate will be reduced from 1% to 0.5%
- For Rs250 million in earnings, the rate will drop from 2% to 1.5%
- The 3% rate for Rs300 million in profits and 4% for earnings above that level will remain unchanged
At the same time, a 5.5% increase in sales tax on 850cc vehicles is under consideration, potentially raising the cost of small cars for consumers.
On the other hand, to support local industries, the government is mulling:
- Reducing additional regulatory duties on over 3,500 imported items and raw materials
- Cutting customs duties by 2–5% on selected items
- Lowering withholding tax on imported raw materials
These measures are intended to make local production more competitive and ease the cost burden on manufacturers.
