Live: Budget 2026 27

ISLAMABAD: The International Monetary Fund (IMF) has projected Pakistan’s economic growth at 3.5 per cent during the current fiscal year and inflation to remain close to double digits for another year, notwithstanding global growth rebounding to 3.4pc.

In its flagship World Economic Outlook, released at the launch of the World Bank-IMF annual meetings in Bangkok, the fund estimated Pakistan’s current account deficit to widen to 1pc of GDP from a surplus of 0.5pc in FY2025. Headline inflation is projected to rise significantly to 9.9pc from 7.1pc last year.

However, the Washington-based lending agency projected Pakistan’s unemployment rate to decline to 6.5pc this year, compared with 6.9pc last year and 7.1pc a year earlier.

The fund, which concluded its review of Pakistan’s economic situation last week, did not explain the projected decline in unemployment despite the rising population and its other economic forecasts, including higher inflation and a widening current account deficit.

The fund’s growth projections are significantly lower than the government’s 4pc target for the current year and the 3.8pc forecast by the World Bank last month. Its estimated 3.5pc growth rate for Pakistan is slightly lower than the 3.6pc recorded last year but higher than the 3.2pc in FY2025.

Saying global economic activity had proved resilient despite multiple challenges, the international lender projected global growth to slow to 3.1pc in 2026 before rebounding to 3.4pc in 2027. Global headline inflation is projected to rise notably to 4.7pc in 2026 before easing to 4.1pc in 2027, it added.

The IMF attributed global economic resilience to the technology upturn, buffers and adaptations that helped mitigate the damage from geopolitics-driven disruptions.

“In less than seven years, the global economy has been subjected to an exceptional sequence of events. The pandemic and the ensuing disruptions to global supply chains; the wars in Ukraine and the Middle East, with the consequent sharp increases in the prices of energy and other commodities; and significant changes in trade barriers and trading relations have tested the resilience of households, firms, financial markets, and governments,” it said.

“Individually, each of these major developments would have been considered unlikely. Their confluence over such a short period of time is even more extraordinary. Yet, despite this barrage of shocks, the global economy has held up,” the IMF said.

It added that labour markets had remained unexpectedly strong, financial systems had broadly withstood the shocks and the sharpest monetary tightening in half a century, while inflation had receded from its peaks in many economies, although it remained persistent in some cases.

The IMF warned that energy-importing economies like Pakistan, which have limited links to the technology value chain, face the most difficult outlook. The margins of adjustment that have helped sustain resilience, however, are not limitless, and risks are skewed to the downside.

Further escalation in conflicts, a reassessment of expectations surrounding artificial intelligence (AI), renewed trade tensions and fiscal vulnerabilities could weaken growth. On the upside, stronger momentum in AI investment and productivity gains from AI, or a sustained easing of geopolitical and trade tensions, could strengthen growth, it said.

The fund advised its members that fiscal frameworks must deliver better results in dealing with disruptive shocks and build policy space through revenue measures. During cost-of-living crises, governments should preserve price signals and rely primarily on temporary, targeted income support for the most vulnerable, it said.

The stable global aggregate masks a reallocation of growth across economies. Countries with limited direct exposure to the war shock and strong participation in the technology upturn are seeing activity hold up or strengthen. Energy exporters outside the immediate conflict zone are benefiting from favourable terms of trade.

Conversely, energy-importing economies with little connection to the technology value chain face the most difficult combination of higher import costs and exchange rate pressures, weaker real incomes, more constrained fiscal space and fewer offsetting demand impulses.

Many low-income and vulnerable countries belong to this latter group, increasing the risk that recent shocks will widen income gaps across and within countries.

The IMF projected world trade volume growth to slow in 2026 and stabilise in 2027, reflecting the drag from tariffs, adjustments in production chains and continued strength in technology-related trade.

Global imbalances are expected to decline only modestly over the medium term, as large fiscal deficits, limited domestic rebalancing, technology-driven capital flows and differing demand compositions across major economies under current policies continue to sustain external gaps.

The medium-term growth outlook remains lacklustre by historical standards and uneven across countries, partly reflecting varying degrees of AI preparedness and the robustness of energy mixes.

Risks are skewed to the downside, the IMF warned, adding that a prolonged stalemate or further escalation in the Middle East could keep energy and food prices elevated and volatile, revive inflationary pressures, worsen fiscal and external balances, and weigh on growth.

Further disruptions to energy infrastructure, cyberattacks or extreme weather events could amplify these effects.

A day earlier, Finance Minister Muhammad Aurangzeb told Reuters that the government expected the economy to grow by more than 4pc this fiscal year despite elevated oil prices. He also said the government was looking to privatise five to six entities during the year, potentially raising more than $1 billion.

Pakistan’s economy remains vulnerable to a prolonged conflict in the Middle East because of its dependence on Gulf energy imports, remittances and financing support from the region.

The government is looking to push for the privatisation of five to six entities that could raise upwards of $1 billion, Finance Minister Muhammad Aurangzeb told Reuters on Monday, stating that he expected the economy to grow by more than 4 per cent this fiscal year despite elevated oil prices.

Pakistan’s economy is considered to be highly vulnerable to a prolonged Middle East conflict given its dependence on Gulf energy imports, remittances and financing support from the region, even as it remains reliant on external financing to bolster foreign exchange reserves and meet debt repayments.

Pakistan has been able to procure adequate quantities of fuel, successfully avoiding any shortages, and critical sectors such as agriculture were holding up, Aurangzeb said.

“So I’m still quite clear that we should clock north of 4pc,” he said in an interview on the sidelines of the annual meetings of the International Monetary Fund and World Bank in Bangkok.

“And on the inflation side, obviously, we are keeping a very close eye because it does have a knock-on impact in terms of the commodity prices.”

Following a period of severe economic turmoil exacerbated by the Covid-19 pandemic, the cash-strapped economy has recovered some of its footing, supported by a $7bn, 37-month IMF loan program known as the Extended Fund Facility signed in 2024 that includes some tough measures such as raising tax revenue on farm income.

Following the privatisation of flag carrier Pakistan International Airlines last year, Aurangzeb said the government has around another dozen entities in the pipeline, including state-owned power distribution companies and the outsourcing of airport operations.

“I expect about five or six of these to go through during this fiscal year,” he said, adding that they could raise more than $1bn.

Privatisation has been seen as a key test of Pakistan’s reform credibility with the IMF, with officials previously underlining that failure to offload loss-making state firms risked renewed pressure on public finances.

“We are quite clear that we want the private sector to lead the country,” said Aurangzeb. “So our role is to help support, assist any way we can in terms of the ecosystem.”

Exchange stabilisation facility

The US-Israeli-led war with Iran, now in its eighth month, and the inflation and hardship it has caused, will dominate the agenda and sideline conversations during the meetings that are being held outside Washington for the first time in three years.

Pakistan, which reached a staff-level agreement with the IMF last week, potentially unlocking about $1.21bn in financing under the Extended Fund Facility and a climate program, is continuing discussions with the United States for a proposed $10bn exchange stabilisation facility, Aurangzeb said.

But he declined to provide a time frame for the conclusion of negotiations.

“If it comes through, this will be a great help for us,” he said, referring to the facility, which is in addition to ongoing talks with the Export-Import Bank of the United States and the US International Development Finance Corporation.

“If it doesn’t come through, this does not, you know, create any problem for us in terms of access to market.”

THE national discourse on the budget has been dominated by what is in the document for the business community, exporters and salaried employees. And the theme is to celebrate the 10 to 15 per cent tax relief given to salaried employees — taken as proxies for common Pakistanis. These beneficiaries earn more than Rs200,000 a month. But 80pc of Pakistani households spend less than Rs100,000 a month, according to last year’s Household Integrated Economic Survey. This is the entire household which may have multiple earners, and not just one salaried employee.

It is true that there are no taxes on salaried employees with an annual income of less than Rs600,000, which roughly translates to Rs50,000 a month. The majority live in rural areas where one-third of the country’s workers earn their living from farming. The agricultural income tax laws passed across Pakistan last year also peg the minimum annual taxable income at the same level. According to the calculations of the Pakistan Agricultural Coalition, 95pc of farmers earn less than this threshold.

So what is in this budget for the vast majority of Pakistanis? Starting at the bottom, the Benazir Income Support Programme allocation is proposed at Rs838 billion, which increases the payout to Rs18,000 per quarter for each of about 10 million families scoring less than 16 on the BISP scorecard. This is three times the BISP payout before Covid; it keeps pace with the devastating inflation numbers of the post-Covid years. But these are the bottom 25pc of Pakistani families. BISP would enhance their monthly expenditure by around 10pc.

The only allocation among the federal budget’s grants and subsidies comparable to the size of the BISP is Rs830bn for the power sector. This budget item has received enormous amounts putatively in the name of poor electricity consumers. But with the fixed cost of electricity as high as it has become in Pakistan, it is less a means of support for poor consumers and more a way of keeping the power sector’s businesses running.

What is in this budget for the vast majority of Pakistanis?

For education and health, the IMF report from May 2026 lists next year’s spending target at 3pc of GDP. Punjab has allocated Rs750bn, Sindh Rs551bn and KP Rs398bn for education. Typically, more than two-thirds of the education budget is spent on salaries — which are essential — but a good portion of the allocations for rehabilitating schools will also create construction activity, which benefits low-skill workers. About a quarter of public schools in Punjab have been outsourced, with the government providing a fixed monthly amount per child. Sindh is outsourcing schools too. Outsourcing of health centres has been gathering pace in Punjab. Meanwhile, the latter province has allocated Rs500bn for health, Sindh Rs354bn and KP Rs335bn.

These allocations are sizable proportions of each provincial budget but the total education budget comes to less than 1.5pc of GDP — far low­er than the 4pc recommended for developing cou­ntries. The low education and health target also begs the question: if Pakistan is collecting about 11pc of GDP in revenue (including collection by provincial governments) and giving away over 5pc to debt servicing, how can it spend 4pc on education? Well, to grow adequately, a developing country needs to collect about 20pc of its GDP in reven­ues. That is when investment to build sch­o­ols, tr­­a­in teachers and provide school meals is possible.

Teacher training and pedagogical improvement are critical. According to the Idara-i-Taleem-o-Aagahi’s Annual Status of Education Report 2025, half of Class 5 students in Pakistan cannot comprehend written text and math intended for students of Class 2. For FY27, Punjab does have a school meals programme for a million early childhood and primary-level students. Where else would we provide good nutrition to children of poor families if not in schools? But the allocation for the provision of nutrition-dense milks — not full meals — is only Rs7bn. There are allocations for wheat purchases by the provinces, but these expenditures are not linked to school meal programmes as they are in many countries which support both farmers and schoolchildren through them.

Pakistan’s beleaguered farmers need protection: from lopsided government policies on wheat and from the impact of climate change. But the federal budget for covering crop insurance premiums for small farmers is only Rs1bn — sufficient only for a tiny fraction of farmers. Schemes to facilitate bank credit for small farmers have been included by Punjab and the federal government. But while Punjab will pick up the mark-up for small farmer loans, the federal government will not.

Nearly 40pc of the national labour force is illiterate. So is a good portion of the youth entering the workforce. And more than 80pc of Pakistan’s employed workers earn from five sectors where low-skill or no-skill jobs dominate: construction, transport, wholesale and retail trade, community and personal services, and manufacturing. For them, the minimum wage has been increased in line with post-Covid inflation. But few employers actually pay it.

The petroleum levy collection target is maintained around the same level as the outgoing year, with a similar consumption of transport fuels assumed. But motorcycles account for some 40pc of Pakistan’s transport fuel consumption. Therefore, a similar proportion of this levy will come from the pockets of the lower middle class: clerks, farmers, labourers, etc.

This budget is a direct win for Pakistan’s women and girls — the removal of 18pc sales tax on sanitary pads. The majority of Pakistanis can expect to be secondary beneficiaries of the budget’s facilitation of the manufacturing and construction sectors. Direct beneficiaries of major budget outlays would be the families at the bottom receiving BISP payouts, those near the top receiving tax relief on their salaries, and those who get subsidised housing loans under the Prime Minister’s Apna Ghar programme. Most Pakistanis can expect to be secondary beneficiaries of the budget’s facilitation of the manufacturing and construction sectors. So it’s a trickle-down, ‘wait for it’ budget.

The writer is CEO of the Pakistan Agricultural Coalition, chairman of Idara-i-Taleem-o-Aagahi, and an adviser on energy policy. He is the author of Dou Pakistan: Har Pakistani Gharanay Tak Khushhaali.

Published in Dawn, July 10th, 2026

ISLAMABAD: Ninety-nine members of the National Assembly, or 30 per cent of the House, attended all 15 sittings of the 28th session, while six MNAs, or 2pc, did not attend any sitting, a Free and Fair Election Network (Fafen) report released for the budget session revealed.

The 15-sitting session from June 10 to 24 had 333 members, with three general seats vacant. Overall, 234 MNAs, or 70pc, skipped at least one sitting, the report stated.

The 13th sitting, which saw voting on demands for grants and consideration of a standing committee report on the budget for FY27, recorded the highest attendance of 75pc, with 300 MNAs present.

According to Fafen, 191 members were present between eight and 14 sittings, while as many as 37 members attended between one and seven sittings.

Prime Minister Shehbaz Sharif attended six sittings during the session, while Leader of the Opposition Mehmood Khan Achakzai attended 12.

Among cabinet members from the NA, six federal ministers and three ministers of state attended all sittings. The lowest attendance was of Communications Minister Aleem Khan, who was present in the House in eight sessions.

Among parliamentary party leaders, PML-N’s Khawaja Asif attended all sittings, as well as Majlis Wahdat-i-Muslimeen’s Hameed Hussain (MWM), National Party’s Pullain Baloch, Balochistan Awami Party’s (BAP) Khalid Hussain Magsi, and PML-Z’s Ijazul Haq.

PPP Chairman Bilawal Bhutto-Zardari attended four sittings, while Maulana Fazlur Rehman of Jamiat Ulema-i-Islam-Fazl (JUI-F) was present in just two sittings.

The ruling party PML-N’s 48 lawmakers were in full attendance out of 132 MNAs, while 15 of PPP’s 74 leaders were present during all sittings.

Out of 75 independents — which include four who sit on the government benches — 27 MNAs attended all 15 sittings.

Regionally, 53 MNAs from Punjab recorded “perfect attendance”, followed by 25 in Khyber Pakhtunkhwa. Six lawmakers from Punjab did not attend any sitting.

Female lawmakers recorded higher proportionate attendance than male colleagues across all 15 sittings, Fafen noted.

Out of the 10 cabinet members who were scheduled for Question Hour, six attended, while parliamentary secretaries attended the remaining ones. Two out of four ministers required for Calling Attention Notices appeared.

Fafen noted that in the preceding session of the NA, 267 members, or 80pc, missed at least one sitting. Only 102, or 38pc, submitted formal leave applications, while 165, or 62pc, were absent without one.

It said the report relied on official attendance and leave records published on the NA’s website and aimed to promote transparency and accountability of elected representatives.

LAHORE: The Punjab Assembly on Monday approved all 38 supplementary budget grants worth over Rs554 billion for the fiscal year 2025-26, following an intense session marked by fierce debates over development funds and a subsequent walkout by the opposition over “shortage” of speaking time.

The session, which commenced two hours behind its schedule under the chairmanship of Speaker Malik Muhammad Ahmad Khan, saw a face-off between the treasury and opposition members over regional development allocations, water scarcity, sewage infrastructure and public transit.

During the debate on the supplementary budget, the opposition lawmakers, including Hafiz Farhat Abbas, Zulfiqar Bhatti, Sheikh Imtiaz and Nadeem Qureshi, launched a scathing attack on the treasury benches.

They heavily criticised the government for what they termed an unequal distribution of development funds, alleged corruption and the persistent neglect of south Punjab, particularly Multan.

Defending the government’s performance, Senior Minister Marriyum Aurangzeb rejected the opposition’s allegations and highlighted “key milestones” of the administration. She informed the House that Chief Minister Maryam Nawaz had successfully delivered 170,000 housing units over the last 14 months.

Detailing the province’s infrastructure roadmap, the senior minister announced that 3,000 electric buses would be deployed across Punjab by next year, with the fleet expanding to 5,000 by the end of the government’s tenure.

She added that clean water and sewage projects are actively underway in 86 cities, noting that Rs42 billion has been explicitly allocated to complete clean water projects in south Punjab, alongside the planned installation of wastewater treatment plants in every city.

Aurangzeb also defended the procurement of an aircraft for the chief minister, stating it was essential for “public service efficiency and emergency responses.”

The proceedings faced a brief disruption when the opposition pointed out a lack of quorum. However, the session resumed after the required numbers were met. Tensions flared again over time constraints for speeches, leading the opposition to stage a walkout in protest.

In the opposition’s absence, the House voted on and approved all 38 supplementary budget demands.

Following the passage of the grants, Finance Minister Mujtaba Shujaur Rehman announced a four-month honorary salary bonus for the employees of the Punjab Assembly, the Law Department, 90 Shahrah-e-Quaid-e-Azam, and other allied departments.

Following the completion of the day’s agenda, Deputy Speaker Zaheer Iqbal Channar adjourned the session to reconvene on Tuesday at 1pm.

Published in Dawn, June 30th, 2026

• Rs250bn earmarked for recurring expenditure, Rs36bn for development
• Rs26.28bn set aside for ongoing projects, Rs8.71bn for new schemes
• Federal pay, pension hike extended to AJK

MUZAFFARABAD: The Azad Jammu and Kashmir (AJK) Legislative Assembly on Monday passed a Rs286 billion budget for the fiscal year 2026-27 just hours after it was presented by Finance Minister Chaudhry Qasim Majeed.

Presided over by Speaker Chaudhry Latif Akbar, the assembly sitting witnessed around 50 per cent attendance, including about five lawmakers from the opposition PML-N and PTI. However, towards the end of the session, there was only one PML-N lawmaker in the House.

The budget comprises Rs250 billion for recurring expenditure and Rs36bn for development, including Rs1bn in foreign assistance.

Presenting the budget, Majeed said the government had framed its financial plan despite severe resource constraints, with public welfare, transparency and good governance remaining its guiding principles.

He said the Inland Revenue Department, which constituted the backbone of AJK’s own-source revenues, had achieved a substantial portion of its collection targets during the outgoing fiscal year. However, he acknowledged that the overall revenue target had once again remained unmet due to multiple factors.

He attributed the shortfall to the State Bank of Pakistan’s reduced policy rate, which lowered banks’ profit margins to between 9pc and 10pc — less than half the level of previous years — as well as a significant reduction in electricity tariffs that adversely affected receipts from education cess and taxes linked to the sale and purchase of immovable property.

Majeed said more than 110 branches of over 70 business entities had been integrated into the AJK Point-of-Sale (POS) invoicing system, which was expected to increase revenue from previously unregistered taxpayers by between 400 and 800pc.

The minister told the House that recurring expenditure would be financed through projected receipts of Rs250bn. Of this amount, Rs146bn would come from AJK’s share in federal taxes under the variable grant, Rs60bn from income tax, Rs15.2bn from other taxes, Rs25bn from internal receipts, Rs2bn from water-use charges and Rs1.8bn from capital receipts, including loans and advances.

The entire Rs36bn development budget, he said, would be financed through a federal development grant.

Among development allocations, the Communication and Works Department would receive the largest allocation of Rs14bn, followed by Rs4.1bn for health, Rs3.3bn each for education and energy and water resources, and Rs3.2bn for the Local Government and Rural Development.

Other allocations include Rs1.7bn for Physical Planning and Housing, Rs1.35bn for governance and miscellaneous sectors, Rs900 million for agriculture and livestock, Rs780m for research and development, Rs600m for forestry and watershed management, Rs550m for information technology and Rs470m for industries and minerals.

Majeed said 76pc of the Annual Development Programme, amounting to Rs26.28bn, had been earmarked for ongoing projects, while Rs8.71bn would finance new schemes.

He added that 93 development projects would be completed by the end of the current fiscal year, while another 170 projects were targeted for completion during 2026-27.

Among recurring expenditures, education would receive the highest allocation of Rs57.25bn, followed by Rs53.5bn for pensions, Rs32.61bn for wheat flour subsidy under the head of State Trading, Rs25bn for health, Rs13.36bn for energy and water resources, Rs13.2bn for the Home Department, Rs10.62bn for miscellaneous grants, Rs9.64bn for general administration, Rs7.07bn for communication and works, Rs4.35bn for law, justice and parliamentary affairs, including the judiciary, Rs3.45bn for relief and rehabilitation, Rs2.5bn for forests, wildlife and fisheries, Rs2.2bn for the Board of Revenue, Rs1.48bn for agriculture, Rs1.36bn for livestock and dairy development, and Rs1.2bn for social welfare and women’s development.

The minister also announced that the salary and pension increases approved by the federal government would be extended to AJK government employees and pensioners.

Majeed also presented the revised estimates for the outgoing fiscal year, reducing the size of the 2025-26 budget from Rs310.2bn to Rs262.165bn.

Published in Dawn, June 30th, 2026

• Thanks to its numerical strength in the house, PPP rejects all cut motions of opposition parties
• CM Murad calls budget a document of prudent financial discipline
• 143 opposition, treasury MPAs take part in budget debate over seven days
• House approves supplementary grants worth Rs165bn

KARACHI: The Sindh Assembly on Sunday passed the Rs3.562 trillion provincial budget 2026-27 with a majority vote, rejecting all cut-motions moved by opposition members belonging to the Muttahida Qaumi Movement-Pakistan, Pakistan Tehreek-i-Insaf and Jamaat-i-Islami.

The assembly also approved the Sindh Finance Bill, under which no new taxes were imposed with Chief Minister Syed Murad Ali Shah saying that existing taxes were rationalised and streamlined.

The house rejected with a majority vote the proposed amendment to the Sindh Finance Bill submitted by Muttahida Qaumi Movement-Pakistan’s Sabir Qaimkhani, seeking an eight per cent super tax on annual agricultural income of Rs50 million or more.

The Bill revises rates across various taxes and widens the tax net, introducing an 8pc super tax on agricultural income exceeding Rs500mn while exempting income below that threshold.

The house also approved supplementary grants worth Rs165bn for the next year with the Leader of Opposition citing Rs273bn in “additional expenditure” through supplementary budget.

A total of 143 lawmakers from the both sides of the aisle took part in the budget debate that lasted for seven days.

CM defends budget

Earlier, winding up budget debate, the chief minister defended Rs3.562tr budget for 2026-27, calling it a document of “prudent financial discipline” and an ambitious roadmap to position Sindh as a regional hub for trade, finance, renewable energy and investment.

He said the province maintained fiscal discipline despite a Rs344bn deficit, reduced federal fiscal space and over Rs95bn in additional expenditures last year.

“Even so, we completed nearly 100 major projects, achieved wheat self-sufficiency for the first time, expanded social protection and continued investing in public services,” he said.

Announcing an Annual Development Programme of Rs720bn for the next fiscal year, he said that Rs206bn had been earmarked for Karachi.

“More than 1,800 schemes are to be completed province-wide,” he added.

The chief minister said that the plans included developing Keti Bandar as a logistics hub through public-private partnership, establishing a Sindh International Financial Centre, a province-wide green energy network, and an agricultural finance system for small farmers.

He said that education and health budgets had been increased while administrative expenses cut by over Rs62bn, with resources redirected to development and welfare.

The CM mentioned the Sindh People’s Housing Scheme for flood affectees as the world’s largest scheme, with one million houses completed and 600,000 under construction.

“The World Bank had approved nearly $1.7 billion for Sindh in just two-and-a-half months,” he added.

CM Murad also highlighted Thar Coal project, expansion of free cardiac care at NICVD, and growing renewable energy capacity.

Responding to the opposition, the chief minister rejected claims he termed “misleading”, including figures on federal transfers and Karachi’s past development spending.

He said official records showed projects worth about Rs33bn during a former city nazim’s tenure, not Rs300 billion.

The chief minister also criticised unfulfilled federal Karachi packages and said current federal support was limited to a few roads.

He also urged the lawmakers to avoid divisive politics and respect all contributions to Pakistan’s creation.

‘Collection of claims’

Opposition Leader Ali Khurshidi said that the provincial budget was a “collection of government claims and announcements” that ignored ordinary citizens, warning that it was taking public trust into deficit.

“Most of our voters are middle or lower class. Does this budget reflect the Quaid-i-Azam’s vision? How will it affect a labourer, a farmer, a mother, a sister?” he asked while concluding the budget debate from opposition side.

He criticised the PPP’s reliance on what he called “electables”.

“Remove the Bajaranis from Kashmore, the Mahars and Shaikhs from Shikarpur, and the Pakistan Peoples Party can’t win,” he said adding that the PPP could not win in Ghotki, Sanghar, Umerkot, Matiari and Tando Allahyar without specific people given tickets.

He said that if they (“electables”) contested as independent, they could not win and the provincial government’s majority would end immediately.

The opposition leader questioned Rs273bn in supplementary grants, including Rs970mn for an IT Park at Bahauddin Zakariya University, Multan.

He said that the home department alone spent Rs10bn extra.

He alleged a big portion of the Rs700bn development budget was going to commissions. “Government officers consider it their right,” he said.

He referred to the province’s grievances such as water rights, gas production and the stalled Hyderabad-Sukkur Motorway and urged PPP Chairman Bilawal Bhutto-Zardari to “put the resignations of the president, governor and members on the table”.

Mr Khursheedi demanded a public inquiry into the Sindh Public Service Commission after “11,000 youth fail while officers’ children pass”, a published Gul Plaza report, pension relief, a 20 per cent raise for lower-grade staff, parity with Punjab Police salaries, and an early completion of the forensic lab.

He also raised KMC employees’ pay, private schools’ fees and uniforms, and alleged BISP irregularities. “Wherever you lift a stone, corruption emerges. If Sindh improves, Pakistan will improve,” he said.

Later the house was prorogued.

Published in Dawn, June 29th, 2026

KARACHI: The City Council on Sunday approved the Rs60.45 billion surplus budget of the Karachi Metropolitan Corporation (KMC) for the fiscal year 2026-27 by a majority vote.

The budget was presented by Mayor Barrister Murtaza Wahab.

According to the budget document, the total receipts are estimated at Rs60.451bn while expenditures of Rs60.406bn, leaving a surplus of Rs44.905m.

The budget is, however, not tax-free as the KMC levied a new tax on hotels in Karachi, projecting an estimated collection of Rs1bn in FY27.

The KMC estimated that it would collect a whopping Rs5.95bn in the head of municipal utility charges tax (MUCT) and advertisement during the next fiscal year.

Mayor Wahab presents annual financial plan in rare calm session

The budget document shows the major expenditure during FY27 is on payment of pension, including a bailout package for KMC retirees, for which a sum of Rs18.210bn has been allocated.

Unlike previous budget sessions, this year’s proceedings remained largely peaceful during the mayor’s budget speech, as opposition members chose not to chant slogans or stage a noisy protest and listened to his speech without interruption.

However, the atmosphere inside the City Council turned charged moments before the budget presentation. As the mayor entered the council hall, treasury and opposition members engaged in a brief but noisy exchange of slogans in support of their respective political parties before order was restored and the budget session formally commenced.

The budget session began with prayers for the departed family members of council members and for Rangers personnel who embraced martyrdom before the council concluded the budget debate and passed the financial plan.

‘Roadmap for development’

In his speech, Mayor Wahab said the budget had been prepared with the objective of addressing Karachi’s pressing civic challenges.

“This budget gives top priority to resolving citizens’ problems and serves as a roadmap for Karachi’s development,” he said.

He said that the KMC allocated Rs8.59bn from its own resources for development projects, while Rs9bn has been earmarked under the District Annual Deve­lopment Programme (ADP).

The mayor said the new financial plan focuses on rehabilitation of roads, brid­ges, flyovers, sewerage infrastructure, parks, green belts, urban forests, solar energy projects, sports facilities, hospitals, heritage buildings, information technology and other civic amenities.

Specific allocations include Rs800m for cleaning storm-water drains and Rs500m for parks and horticulture.

The budget provides development funds for UCs, road rehabilitation, infrastructure improvement, solarisation projects, development grants for minority communities and several new development schemes.

Opposition wants larger allocations for Karachi

While the treasury benches maintained that the budget reflects realistic priorities and seeks to improve civic services despite financial constraints, the opposition insisted that Karachi’s infrastructure backlog and growing population demand substantially larger financial allocations.

Opposition members criticised the financial plan, arguing that it falls far short of the city’s requirements.

Leader of the Opposition Advocate Saifuddin of the Jamaat-i-Islami said the size of the budget was insufficient for a megacity like Karachi.

“A Rs60 billion budget cannot meet the needs of a megacity like Karachi. The city requires at least a Rs300 billion local government budget, while the present budget lacks the resources needed to resolve citizens’ problems,” he said.

Members belonging to Pakistan Tehreek-i-Insaf (PTI) and Jamiat Ulema-i-Islam (JUI-Fazl) also participated in the budget debate, calling for greater financial powers for UCs, special allocations for underdeveloped areas, greater transparency in budget preparation and equitable distribution of development funds among all elected representatives.

When put to a vote, the City Council passed the budget with a majority.

Published in Dawn, June 29th, 2026

Parliament passed the Rs18.8 trillion budget FY27 on Tuesday, June 23, 11 days after its presentation on June 12, following successive daily sittings. The budget incorporated around 30 major government-backed amendments while rejecting all of the opposition’s proposals. The proceedings were marked by repeated disruptions and heated protests from opposition parties throughout the budget sittings.

A robust budget debate, with active parliamentary participation, meaningful Senate scrutiny and detailed examination by parliamentary committees, is widely regarded as essential to an effective budget process. It strengthens democratic oversight, promotes transparency and accountability, improves the quality of fiscal decision-making and helps ensure that public spending better reflects the priorities and aspirations of the people through their elected representatives.

There has been some progress, with greater parliamentary participation and a more active role of the finance committee in budget scrutiny, supported by technical experts. Yet Pakistan still has a long way to go to make the process more inclusive, rigorous and effective. Allowing more time for parliamentary scrutiny, instead of rushing the budget through in little over a week, would be an important step. Globally, legislative budget debates range from two weeks to over three months, while in Bangladesh and Sri Lanka they typically last at least three weeks.

The Pakistan Institute of Legislative Development and Transparency tracks the quantitative aspects of budget debates in both houses, including the number of sittings, hours and legislators’ participation. “Most speeches are not focused on the budget but on constituency issues and politics. I am not aware of anyone systematically assessing the quality of the budget debate,” says Ahmed Bilal Mehboob, its founding president.

‘Parliament in session is parliament on display; parliament in committees is parliament at work’

He was reluctant to say that the overall quality of budget debates has improved definitively, but highlighted a notable advance over the past two years: the National Assembly Standing Committee on Finance has begun scrutinising the budget with technical support from experts provided by the United Nations Development Programme. He credited committee chairman Syed Naveed Qamar for the initiative, calling it a significant improvement.

Mr Mehboob said the effectiveness of budget debates should be judged by time allocated, attendance, opposition participation, committee activism and amendments resulting from deliberations. He added that parliamentary debate can influence fiscal decisions, particularly when widely supported and amplified by the media, and described the finance committee’s growing activism as the strongest recent improvement.

In his study, ‘Critical study of budget making process’, Saddam Hussein, a researcher at the Pakistan Institute of Development Economics, identifies several structural flaws that undermine both budget formulation and implementation. Besides limited parliamentary debate, he points to legislators’ weak economic understanding and the bureaucracy’s overwhelming dominance of the process.

Mr Hussein advocates participatory budgeting, under which citizens directly help decide how a portion of public funds is spent. “It enables taxpayers to work with government to make budget decisions that affect their lives,” he explains. Citing Brazil’s experience, he argues that participatory budgeting helped counter patronage, inequity, and corruption and merits experimentation in Pakistan to improve transparency, accountability and citizens’ participation in revenue and spending decisions.

The OECD recommends presenting budgets at least three months before approval, but Pakistan’s parliament typically has barely two to three weeks, compared to seven to eight weeks in India

Mukhtar Ahmad Ali, Executive Director of the Centre for Peace and Development Initiatives (CPDI), argued that democratic accountability requires that every rupee raised or spent undergo meaningful parliamentary scrutiny. Yet, he said, Pakistan’s legislatures play a limited role in budget preparation, approval and oversight.

While the Organisation for Economic Cooperation and Development (OECD) recommends presenting budgets at least three months before approval, Pakistan’s parliament typically has barely two to three weeks, compared to seven to eight weeks in India, where subject committees conduct three to four weeks of detailed scrutiny.

A key weakness, he noted, is that Pakistan’s budget is not referred to relevant standing committees for line-by-line examination. Instead, only the finance committees review it, with little time and a focus largely on headline figures. The situation is worse in provincial assemblies, which typically pass budgets within a week without any committee scrutiny.

Mr Ali called for stronger parliamentary oversight by empowering standing committees to undertake detailed reviews and consult experts and civil society. “Parliament in session is parliament on display; parliament in committees is parliament at work,” he remarked, arguing that Pakistan’s budget debates often become political theatre while serious scrutiny remains largely absent.

Salahuddin Safdar, a senior expert at Free and Fair Election Network, said this year’s budget process has yet to be analysed, but noted that coalition governments generally face greater scrutiny than single-party administrations, as coalition partners often press for amendments that are incorporated into the budget. By contrast, constitutional provisions requiring ruling-party legislators to support the budget presented by their party leave little room for change in majority governments.

He also pointed to a reform introduced around 2015, when the National Assembly’s rules were amended to require ministries to submit development budget proposals to relevant standing committees by March for input. While the change has potential to strengthen parliamentary oversight, Mr Safdar said its impact has been limited because implementation depends largely on the commitment of the committee chairpersons, and the process has not been followed as rigorously as intended.

Published in Dawn, The Business and Finance Weekly, June 29th, 2026

• Officials term JAAC’s call for election boycott ‘an attempt to remain in the spotlight’
• AJK govt set to unveil Rs286bn budget today

MUZAFFARABAD: As leaders of the proscribed Joint Awami Action Committee (JAAC) urge their supporters to boycott next month’s polls in Azad Jammu Kashmir (AJK), the administration sees the effort as an attempt to keep themselves in the spotlight.

In a video circulating on social media, a JAAC leader – identified by an official as Umar Nazir Kashmiri – can be heard asking the crowd: “After the way this game has been played with us, will you still take part in this sham and fraudulent election?” The crowd responds with a resounding ‘no’.

Official sources said JAAC leaders are now employing emotionally charged rhetoric to keep their supporters mobilised amid the ongoing standoff with the government.

Confirming the development, Poonch divisional commissioner Sardar Waheed Khan identified the speaker as Umar Nazir. Explaining their logic, he said they think that if people turn towards electioneering, the JAAC and its cause will lose relevance.

Signs of life

Meanwhile, routine life began to return in Muzaffarabad, with transport being partially restored, despite announcements by some traders’ representatives that businesses would resume over the weekend.

The city and other parts of AJK, had remained in the grip of a strike for several weeks. However, normalcy is slowly returning to the region as the strike call peters out.

Most markets in the city remained shut on Sunday, but a government official pointed out that this was due to the weekly holiday for traders, and expressed hope that commercial activity would return to normal on Monday.

Public transport also showed signs of revival, with most buses and other passenger vehicles, which had remained off the roads for nearly three weeks, returning to their terminals near the new bus stand.

Fuel supplies, however, continued to affect the resumption of transport services. Except for a handful, most gas stations remained closed on Sunday, though officials said the issue was expected to be resolved on Monday.

Transporters said operations could not fully resume because of the fuel shortage, adding that services on all routes would be restored once the government allowed petrol pumps to resume regular supplies.

Budget today

Meanwhile, the AJK government is expected to present its annual budget for the financial year 2026-27 in the Legislative Assembly today, a day before the close of the current fiscal year.

Minister for Finance and Inland Revenue Chaudhry Qasim Majeed will table the budget — with a proposed outlay of Rs286 billion — before the house. According to official sources, the proposed budget includes Rs250bn for recurring expenditure and Rs36bn for development.

The finance minister will also present the revised estimates for the outgoing fiscal year, reducing the overall size of the current budget to Rs262.165bn, comprising Rs230bn for recurring expenditure and Rs32.165bn for development. The coalition government approved a Rs310.2bn budget for 2025-26 in June last year, of which Rs49bn was earmarked for development projects.

The session would likely be thinly attended as many lawmakers are busy campaigning for the forthcoming general elections.

The budget is expected to be passed the same day without debate, in keeping with the convention followed in the final year of previous legislative assemblies, when outgoing governments secured approval of their last budgets before the house was dissolved for general elections.

Published in Dawn, June 29th, 2026

PESHAWAR: Lawmakers in Khyber Pakhtunkhwa Assembly rejected the decision of federal government to impose taxes on the residents of tribal districts and Malakand division.

They threatened to stage protest demonstrations unless the decision was withdrawn. The lawmakers, nearly all representing tribal districts and Malakand division, stated that the Swat State enjoyed a century-long tax-free guarantee after it joined Pakistan. They said that federal government, before taxing tribal districts, should first fulfil its promise of releasing Rs100 billion annually for the region.

While talking during a KP Assembly sitting on supplementary budget held with Speaker Babar Saleem Swati in the chair, Minister for Housing Dr Amjad Ali, who belongs to Swat district, said that federal government announced imposing tax on former Federally Administered Tribal Areas and Provincially Administered Tribal Areas.

He said that no discussion was held over taxing both the areas in the meeting of National Economic Council (NEC). He stated that the areas affected by calamities and militancy should be facilitated instead of imposing taxes on them. He adding that it was violation of the agreement reached with the then Swat State when it was joining Pakistan.

KP Assembly speaker apologises for allowing outsider to enter the house

Fazal Hakim, another lawmaker from treasury benches belonging to Swat, said that they represented people and would protest for the rights of residents of their constituency. He said that once taxes were imposed, industry would shift from the areas and thousands of people would lose their jobs.

The leader of opposition, Dr Ibadullah, who belongs to Shangla district, however, stated that the then chief minister Parvez Khattak had moved a summary for the purpose and he, being part of National Assembly at that time along with his brother MNA Amir Muqam, protested, which compelled the then prime minister Mohammad Nawaz Sharif to withdraw it.

PML-N’s lawmaker Jalal Khan condemned taxing tribal districts and Malakand division. He said that he would request Federal Minister for Kashmir Affairs and Gilgit-Baltistan Amir Muaqam to exempt tribal districts and Malakand division from taxes.

He stated that the opposition was being mistreated, not only by provincial government but also by federal government.

ANP’s Mohammad Nisar, from Bajaur tribal district, said that federal government imposed taxes in former Fata and Malakand but it failed to fulfil its promise of releasing Rs100 billion annually for the region.

He stated that they refused to accept the decision of federal government. He said that federal government was not paying Rs5,000 billion to the province but provincial government committed to surrender Rs109 billion to it.

He criticised funds for defence and said that people were unsafe in Bajaur while militancy could not be rooted out in 25 years.

The adviser to chief minister on industry, commerce and technical education, Humayun Khan from Dir said that people from Malakand division and former Fata paid billions of indirect taxes.

Bajaur’s treasury MPA Anwarzeb Khan said that people of tribal districts were being mistreated. He stated that federal government refused to accept share of tribal districts in NFC.

MPA from Khyber Abdul Ghani warned of protesting outside Parliament House in Islamabad.

Earlier, Dr Ibadullah expressed serious reservations over entry of an outsider to the house.

“Your chair is required to play role of custodian of the house and to maintain privilege of the house,” Mr Ibadullah said. He added that the outsider [the chief minister’s guard] chanted slogans [in favour of former prime minister Imran Khan in the house].

“I admit my fault. The security stopped him but I allowed him,” said Speaker Babar Saleem Swati and apologised.

JUI-F’s Maulana Lutfur Rehman stated that a supplementary budget was always presented in emergency situation. “There is need for steps to financially strengthen the province,” he said, adding that Chashma Lift Canal could not be completed during the last 13 years.

Correspondent from Bajaur adds: Political leaders, parliamentarians and traders here on Saturday criticised federal government for extending taxes to tribal districts and Malakand division in its budget and called for revision of the decision immediately to prevent public unrest.

In their separate statements, PML-N’s Israruddin Khan, MPAs Dr Hamidur Rehman and Anwar Zeb Khan, Bajaur Chamber of Commerce and Industry president Haji Lali Shah, Khar Traders Association president Wajid Khan, PTI’s Guldad Khan, ANP’s Gul Afzal Khan and former MNA Gul Zafar Khan described withdrawal of tax exemption for former Fata and Pata as “absolutely devastating” for the backward areas.

They said that imposing taxes on the people of tribal districts was unacceptable to them because the area lacked basic facilities and remained underdeveloped. They said imposing taxes on tribal districts and Malakand division was injustice with poor people. They said that the government should have first brought those areas at par with settled districts politically, economically and socially.

They urged Prime Minister Shehbaz Sharif to withdraw the decision at the earliest. They urged federal government to first fulfil the Sartaj Aziz Commission’s commitments before imposing taxes on the residents of tribal districts.

They claimed that the government had no legal authority to impose taxes in tribal districts before 2028, as per Sartaj Aziz Commission’s recommendations, which paved the way for the merger of tribal districts into Khyber Pakhtunkhwa through the 25th Amendment in 2018.

They warned of strong public reaction if the decision was not withdrawn immediately.

Published in Dawn, June 28th, 2026

LAHORE: The Punjab Assembly on Friday passed the provincial budget 2026-27 during a session amid a walkout by the opposition Pakistan Tehreek-i-Insaf (PTI).

The opposition protested that it had not been allowed sufficient time to speak on the cut motions, pointed out a lack of quorum, and eventually staged a walkout during the approval of budget grants.

Following the opposition’s departure, the House approved all 131 demands for grants and passed the Finance Bill, thereby formally adopting the Punjab government’s budget for the 2026-27 fiscal year.

Senior Minister Maryam Aurangzeb defended the government’s performance, particularly the security arrangements for Ashura, saying over 124,000 security personnel had been deployed. She said advanced technologies, including thermal drones, QR codes, and Safe City surveillance cameras, were used for the first time to ensure foolproof security.

She also highlighted the government’s development agenda, stating that more than 340 out of the 437 development schemes had already been approved, with projects underway in climate change mitigation, smog control, forestry, clean drinking water, south Punjab, and public welfare. She criticised the opposition, alleging it had neither studied the budget nor examined the facts.

Auranzeb’s speech was repeatedly interrupted by opposition lawmakers chanting slogans, prompting treasury members to respond. The House descended into chaos as members from both sides confronted each other across the aisle.

Finance Minister Mujtaba Shujaur Rehman urged the deputy speaker to suspend opposition members who, he alleged, chanted slogans against the ruling party’s leadership, saying the Business Advisory Committee had agreed that no member would target another party’s leadership during the proceedings.

Published in Dawn, June 28th, 2026

KARACHI: The Sindh Assembly continued general discussion on the provincial budget for the next financial year for the sixth consecutive day on Saturday, with senior parliamentarians from both the treasury and opposition benches calling for mutual respect amid their criticism of each other.

As many as 10 more members, including six ministers, delivered speeches during a nine-hour debate on the budget in a thinly attended house.

Senior Minister Sharjeel Inam Memon, who also holds the portfolios of transport and information, said that Sindh was the first to adopt artificial intelligence (AI) for media monitoring and to establish a Journalists Protection Wing and a Sindh Information Commission.

He said press freedom was “most vibrant” in Sindh, but the government had become its “biggest target”.

Sharjeel says press freedom is ‘most vibrant’ in Sindh

He regretted the spread of “fabricated stories” and said that criticism was a right, but verification was a responsibility.

The information minister said that the provincial policy included a budget allocation and that Sindh’s first feature film, Mera Lyari, was made for about Rs55 million, not Rs20m as claimed in a section of the media. “The film was screened internationally and later acquired by a private TV network,” he added.

He said that “iWork for Sindh” platform had received 4.8m visits and 113,000 registrations, with an AI “Auto CV” feature for job seekers.

The senior minister said work on the Bus Rapid Transit (BRT) Yellow Line was progressing, a section of the Taj Haider Bridge had been completed, and the depot was under construction. He added that the Red Line contract was terminated for delays and awarded to the Frontier Works Organisation (FWO).

He said that daily ridership on the Orange Line had increased from 1,800 to 8,500, while that on the Green Line had risen from 53,000 to 78,000 in three months after its handover to the province.

He said that the Peoples Bus Service, subsidised by the province, carried about 125,000 passengers daily in eight cities.

The minister added that the province had also introduced Pakistan’s first EV buses and the Pink Scooty Scheme. “From 150 women with motorcycle licences at launch, 25,000 have now applied, he said, adding that 100,000 was the target.

He noted that an EV taxi and “Pink Taxi” service for women would be launched this fiscal year.

The senior minister said the Sindh Revenue Board had increased its collections by 24 per cent against FBR’s 10 per cent, with only 368 staff, while the federal tax authority had over 23,000 staff.

He said that Thar coal now generated 3,960MW after work resumed in 2008, and 2.1m flood-affected houses were being built, with ownership in women’s names. “NICVD [National Institute of Cardiovascular Diseases] has treated 4.74 million patients, including those from other provinces,” he added.

MQM-P ready to work with treasury benches, PTI lashes out at govt

Muttahida Qaumi Movement-Pakistan (MQM-P) Deputy Parliamentary Party Leader Taha Ahmed told the assembly that his party was ready to work with the treasury benches, but could not accept “humiliation” or baseless allegations.

“We were speaking on the budget from our side when allegations began from the government benches.”

He said that his party was ready to shake hands and move forward with the government, but could not accept humiliation or unsubstantiated allegations on the floor of the house. “The survival of this city and this province lies in moving together,” he added.

The MQM-P leader said politicians were being targeted with fake news on social media, and that his party had even been accused of being Research & Analysis Wing (RAW) agents.

He said that Karachi’s peaceful era was in 1990, asking why an operation was launched against us in 1992, “How can it be that you get my children killed and expect me to shake hands?” he wondered.

Pakistan Tehreek-i-Insaaf (PTI) Parliamentary Party Leader Shabbir Qureshi lashed out at the provincial government, saying town chairmen were engaged only in corruption.

He said that a hospital built during Zulfikar Ali Bhutto’s era was “presenting the scene of ruins” and urged the government to rebuild it.

He said that Karachi bore the look of a war-torn city. “For the past 18 years, the same issues have been discussed without any progress,” he added

‘No terrorism incident reported in Karachi this year’

Home Minister Ziaul Hasan Lanjar, during his speech, informed the assembly that the police force comprised 170,000, with 134,000 on active duty.

He reported a 7 per cent decline in mobile snatching, and a 10 per cent overall drop in vehicle theft and snatching. “Violent crime is down 40 per cent year-on-year, and no terrorism incident was reported in Karachi this year,” he added.

The home minister said that the Counter Terrorism Department had carried out 642 intelligence-based operations, with terrorism cases down 80pc and 66 militants arrested. “A major plot was foiled after 200kg of explosives were seized from a truck in Karachi,” he added.

Mr Lanjar said that a mobile app was being developed to register phone sellers to curb the trade of stolen devices, adding that the Citizen Police-Liaison Committee had returned 2,458 snatched phones to their actual owners.

On Katcha operations, he said 539 bandits had surrendered since ‘Operation Nijaat’ began in January, and areas once considered no-go zones in Kashmore were now open to all.

The home minister, who also holds the portfolio of law and the parliamentary affairs department, said that the status of gutka and mawa would be brought under the narcotics law with cabinet and assembly approval.

He said that in two years, 7,554 drug dealers were arrested, and school rules were amended to require anti-narcotics action. Cocaine, he said, was entering via Lahore and Peshawar airports, not Karachi. “Red warrants have been issued for four extortionists based abroad, he added.

Sindh Local Government Minister Syed Nasir Hussain Shah said hundreds of schemes had been completed, with parks, roads and civic facilities improved.

Labour Minister Saeed Ghani said that the minimum wage had been set at Rs43,000 from July 1, approved by the Minimum Wage Board.

He said that the Workers Welfare Board had secured a federal income tax exemption, with Rs13.2 billion targeted from social security this year.

Culture and Tourism Minister Zulfiqar Ali Shah said that libraries were being digitised and motels planned for Naushahro Feroze, Umerkot and Thar.

He called for motorway infrastructure in Sindh to reduce accidents.

Excise and Taxation Minister Mukesh Kumar Chawla said infrastructure and motor vehicle tax were being collected, with relief extended to businesses despite legal issues.

The house was adjourned to meet at 10am on Sunday (today).

Published in Dawn, June 28th, 2026

President Asif Ali Zardari gave his assent on Friday to the Finance Bill, 2026, which outlines the budget for the upcoming fiscal year with an outlay of Rs18.8 trillion.

“President Asif Ali Zardari has assented to the Finance Bill, 2026, relating to the federal budget for fiscal year 2026-27,” a post on the Presidency’s X account said.

Finance Minister Muhammad Aurangzeb presented the FY2026-27 budget in the National Assembly (NA) on June 12, offering relief to higher-income salaried individuals and businesses by rationalising income tax, sales tax, and customs duties, while promoting documentation, digital compliance, and investment.

The NA passed the budget on Tuesday after the opposition staged a walkout. The House approved the budget after all seven amendments moved by opposition members were rejected by a majority vote. However, the finance bill included amendments suggested by the National Assembly Standing Committee on Finance.

In the new budget, income tax slabs have been eased, super tax rationalised, excise duties cut, and sales tax exemptions widened to cover magazines, ship­ping, and refineries, while levies on deemed income and the tampon tax have been removed.

Excise duty on business class international travel has been drastically reduced in the budget, with the levy on tickets to North, Central, and South America cut to Rs50,000 from Rs350,000. Rates for tickets to the Middle East and Africa have been reduced to Rs25,000 from Rs105,000, while business-class travel to Europe now costs Rs40,000 instead of Rs210,000. The same reduction applies to tickets for the Far East and Australia, where the duty has been brought down to Rs40,000 from Rs210,000.

The government has done away with the proposed 20 per cent Federal Excise Duty on mineral waters, aerated waters, hydration drinks or electrolyte beverages with artificial sweetener or sugar content below 5g/100 ml.

The budget also includes permission for all airlines operating in the country to avail sales tax exemption on the import or lease of aircraft and their parts from July 1, 2027.

The excise duty on imported electric cars would be calculated based on their values, to be calculated in US dollars.

No FED will be applicable on electric cars and electric SUVs imported in Completely Built-Up (CBU) condition with a value not exceeding $75,000, as determined under section 25 of the Customs Act, 1969.

Meanwhile, 30pc excise duty will be applicable on electric cars and electric SUVs valued between $75,000 and $110,000, while those whose value exceeds $110,000 would face 40pc excise duty.

The Device Identification, Regist­ration and Blocking System (DIRBS) tax on imported phones will now be paid in instalments, but all instalments have to be paid before the end of the financial year in which the import is made.

Persons having turnover up to Rs200 million may opt out of the fixed tax regime, subject to a final and irrevocable certificate filed with the Tax Commissioner before filing their returns for the tax year 2027.

The minimum rate of value addition tax shall be one per cent in the case of import of coal, subject to the conditions that such imported coal is exclusively and directly supplied to Independent Power Producers.

Under the new budget, income tax exemptions wou­ld be available on any income derived by a private equity and venture capital fund registered under Private Funds Regulations, 2015.

This will be applicable where not less than 90pc of the accounting income of that year, as reduced by accumulated losses and unrealised capital gains, is distributed by the private equity and venture capital fund to its unit or certificate holders or shareholders.

This exemption will not be available if the private equity and venture capital fund is established to acquire a public listed company, whose status has not been changed to pri­­vate limited company on the acquisition.

In addition, the finance bill states that for steel melters, re-rollers and composite units, tax will be collected on the basis of per unit electricity consumed, including use of electricity produced by a captive power plant or through any other alternative source of energy at the rate or rates as prescribed by FBR.

The tax so collected shall be an adjustable input tax, to be claimed in the return of the month in which such payment is made. The per unit sales tax shall be determined by the FBR on the basis of minimum notified price and the industrial benchmarks of consumption of electricity against per ton production of steel products.

ANOTHER budget cycle is behind us. The government has had no difficulty in securing parliamentary approval for the new budget. Sadly, few parliamentarians are known to scrutinise the document; even fewer have something to say about the merits and demerits of its contents.

The IMF is happy because the document is within the limits of the boundaries it has set under its stabilisation programme.

As stated by Finance Minister Muhammad Aurangzeb, the budget will hopefully deliver growth, no matter how modest, without destabilising the Fund programme or the economy. If regional uncertainty ends and energy supplies and prices become steady, growth may even slightly exceed expectations, which would give the government something to flaunt ahead of the next elections. Whether it would impress the electorate is another matter.

Though not a bad document per se, the budget for FY27 is a familiar one, and familiarity in our economic history is rarely cause for comfort.

The next financial year will begin with the same structural problem that has haunted an economy overly dependent on consumption, remittances and, once again, real estate.

Mr Aurangzeb’s claims of introducing ‘structural reforms’ notwithstanding, the document actually offers ‘structural continuity’. His signature focus — sustainable and export-led growth — for instance, reminds one of what the budget lacks instead of what it contains.

No government has delivered sustainable growth driven by exports because of policy failure. Export-led growth demands productivity gains, value-chain advancement and competitive manufacturing. It cannot be achieved through subsidised loans or reduced taxes alone.

Likewise, the budget hardly does anything to correct the tax system, which continues to charge presumed liability before it determines income on which to charge it. Small wonder the tax-to-GDP ratio remains among the lowest in the world.

The government knows about all these issues. It has said as much. And yet the budget it has produced offers little to deliver on the promise of reforms.

What, then, should we expect in the new fiscal year? As stated, the year will deliver faster growth than we have experienced in recent times. If energy prices level out, the country will successfully pull off most IMF-mandated fiscal stabilisation targets.

But the next financial year will also bring the government towards its final stretch. Election cycles in Pakistan have their own challenges: spending pressures intensify, fiscal discipline softens and populist gestures multiply. The new budget carries the seeds of such measures.

Growth next year is probable. Sustainable growth remains a promise deferred. The difference between the two is the question the next budget will answer — and going by existing evidence, it is a question the government has chosen not to ask.

Published in Dawn, June 26th, 2026

A BUDGET White Paper is meant to let the public check the government’s figures and it does that chiefly by printing the “actuals” – the numbers reconciled with the accountant general’s office, ready each year by August, beside the estimates. Side by side, they show how close last year’s budget came to what was collected and spent. Khyber Pakhtunkhwa’s White Paper for 2026-27 has quietly dropped that column.

The 2024-25 edition carried several years of actuals, the 2025-26 edition still gave three, the 2026-27 gives none, showing only budget and revised estimates; estimate against estimate. The usual excuse, that the figures were not ready, does not hold: these are not audited accounts but AG-reconciled numbers, and those for 2024-25 were in hand by August 2025, long before the White Paper appeared. Even if the actuals survive elsewhere in the volume, removing them from the main tables weakens it, since comparing budget with outturn is the surest test of a budget’s realism.

This matters most because of one big change. A year ago the province announced a surplus of Rs157 billion, the largest of any province; this year, a deficit of Rs48 billion, a swing of over Rs200 billion in 12 months.

A provincial surplus is widely misunderstood. It exists mainly to satisfy the IMF: the combined federal-and-provincial deficit is capped as a share of GDP, and since the federal side alone would breach it, the provinces must make up the difference. The budget figure is only a projection, the real surplus is whatever cash remains in the province’s accounts (Account No. I and IV) when the books close on June 30, and in my experience it often falls well short. And, contrary to what many assume, it is never handed to the Centre; it stays in the province’s own accounts, working by sitting unspent.

Which is why the missing actuals matter; it is that real, end-June surplus the deleted columns recorded. The Chief Minister, Sohail Afridi, has made no secret of the deficit, as the press reported, the province is withholding the grant it would pass to the Centre until the jailed Imran Khan is allowed his meetings and treatment, and will meet the gap from its own savings – the leftover balances of past surpluses. So one may fairly ask whether the Rs157 billion was ever saved, and how far this year’s deficit will draw it down, and only the actuals can answer.

Let me be clear: I am not alleging concealment – an honest format change would look the same. My point is narrower. Just as the province swings from surplus to deficit and ties part of its dealings with the Centre to a political demand, the document the public would most want to examine is the hardest to read.

What I ask costs nothing and favours no one: put the actuals back, or publish the reconciled figures for the last three years somewhere equally accessible. The reversal may have a sound explanation – but a White Paper should set it out, not leave us guessing.

— The writer is a former federal secretary and a former secretary finance of KP

Published in Dawn, June 25th, 2026

LAHORE: Punjab Finance Minister Mujtaba Shujaur Rehman has strongly criticised the opposition, stating that the Leader of the Opposition spent the last five days debating the budget without any preparation and remained entirely unaware of the actual funds allocated for proposed projects.

Concluding the debate on the provincial budget for the upcoming fiscal year in the Punjab Assembly, the finance minister addressed various allegations while detailing the government’s fiscal performance and major welfare allocations.

He highlighted the government’s high efficiency in utilising funds and hitting revenue targets during the current fiscal year. He announced that the provincial government successfully utilised 93 per cent of its development budget and achieved 99pc of its revenue target.

Regarding regional development, the government has allocated Rs556 billion for 387 schemes in south Punjab, alongside Rs38bn earmarked for the Katcha riverine areas. For public welfare, the administration has set aside Rs29bn for the Health Card, Rs12.5bn for the Kisan Card, and Rs5bn for the Dhee Rani Programme.

Mujtaba trumpets govt performance, claiming that opposition leader entirelyunaware of actual allocations

The minister specifically clarified that the Health Card programme has not been shut down, but has instead been redesigned to be more effective and efficient.

Dismissing the opposition’s corruption allegations as completely baseless, the minister pointed instead to international reporting metrics. He stated that according to reports by international organisations, Pakistan’s position on the corruption index has actually improved by four degrees over the last two years compared to the previous Buzdar administration.

He added that had Nawaz Sharif’s past governments not been repeatedly ousted, Pakistan’s economic situation today would have been vastly superior.

Turning to the ongoing political deadlock, the finance minister emphasised that the current government did not file politically motivated cases against its rivals. He remarked that the opposition did not attack the GHQ and Jinnah House at the government’s behest, referring to the violent protests of May 9.

Rehman concluded by stating that the opposition’s political situation would not improve until they sincerely and wholeheartedly apologise for the crimes committed on May 9.

Published in Dawn, June 25th, 2026

THE annual budget season has ended with parliament’s approval of federal budget 2026-27. Once passed, the activity and debate surrounding the budget’s preparation subsides until the next year — exposing the wide gap between policy pronouncements and actual outcomes. The budget shouldn’t be seen as an annual, stand-alone affair but as an integral component of a medium-term budgetary framework, translating policies and reform priorities into resource allocations and implementation plans. Take the National Tariff Policy. It was formulated after stakeholder consultations, publicly announced and subsequently reflected in the budget. Policy predictability and credible implementation plans help businesses and investors make informed decisions.

Preparations for the next budget should start now. Policies for industrial development, integrated energy planning, taxation, education and skills must be finalised with evidence-based analysis and extensive consultation. Once approved, the budget should simply provide the resources required for implementation, thus reducing the disconnect between ambitious policy aims and disappointing outcomes. The 2010 NFC Award, for example, envisaged a tax-to-GDP ratio of 15 per cent; 15 years later, we’re stuck at 10-11pc.

Moving from stabilisation towards growth, four main post-budget tasks merit attention: setting clear priorities, boosting oversight and monitoring mechanisms, assigning responsibility for execution and adopting more meaningful performance indicators. An empowered local government is needed to improve service delivery. Citizens judge governments by the quality of education, healthcare, water supply, roads, transport and recreational facilities — services which are delivered effectively only when authority, resour­ces and accountability are devolved to LGs. A constitutional amendment specifying responsibilities and resource allocations for LGs is more practical than proposals for creating new provinces.

Setting national priorities: The most important priority is digitisation. Digital infrastructure, connectivity, integrated databases, digital payments, e-governance and AI can transform virtually all sectors of the economy. For instance, at JPMC, Karachi, AI-aided pre-consultations have reduced the workload of specialists who can devote more time to patient care. Similar technologies can automate routine tasks in education, finance, taxation, agriculture and public administration. Integrated e-governance can revolutionise government functioning. Officials can retrieve data instantly through a centralised digital repository of files and records, replacing the cumbersome seven-tier bureaucratic hierarchy where physical files take weeks to move. Time-sensitive files often go missing, delaying decisions and encouraging rent-seeking. Digital workflows can improve efficiency and transparency. Digital payment systems and wider use of QR-code and card-based transactions would further document economic activity and broaden the tax base. Investing in skills related to AI, cloud computing, robotics, cybersecurity, biotechnology, renewable energy and semiconductor design can support domestic productivity and export growth.

Preparations for the next budget should start now.

Institutional strengthening is the second priority. Organisations such as the armed forces, the FO and SBP have shown that strong mandates, professionalism and operational autonomy produce results. Institutions such as the auditor general, SECP, Nepra, Ogra, Wapda and FBR should also be strengthened. Third, parliamentary committees must have a meaningful role throughout the policy cycle. Draft medium-term budgetary fra­­meworks, strategy papers, annual plans, reform proposals, etc, should be presented to committees for discussion. Broader political ownership will enhance policy continuity and reduce resistance to reform.

Finally, work on targeted subsidies, tax harmonisation, provincial revenue mobilisation, etc, must be completed in time to be incorporated in next year’s budget. Reform sequencing and timing can be finalised after consulting businesses, SMEs and farming communities.

Strengthening oversight and monitoring: The National Economic Council and its executive committee (Ecnec) are notable examples of institutions responsible for coordination and oversight. The NEC meets only once or twice a year, mainly to endorse annual plans; Ecnec focuses largely on project approvals. Neither has consistently examined whether development policies are coherent, mutually reinforcing and being implemented well. A two-tier oversight mechanism is needed. Federally, the secretaries’ committee should be the main forum for inter-ministerial coordination. Matters needing political decisions can then be referred to cabinet committees — and if necessary, to the cabinet. The second tier should focus on federal-provincial coordination. Inter-provincial ministerial committees on agriculture, education, health, taxation, climate change, population planning, skills development and digitisation should regularly review progress. Unresolved issues could be escalated to Ecnec and, ultimately, the NEC which should also approve an integrated national budgetary framework. These fora should be supported by a digitised monitoring system to track progress against set milestones and provide real-time evidence for decision-making.

Assigning responsibility: A recurring governance weakness is the absence of clearly defined responsibility. Performance agreements containing measurable aim and key performance indicators should be introduced for ministers, secretaries and heads of public organisations. This would require revisiting the Rules of Business to clarify the division of responsibilities. The existing bure­aucratic hierarchy should be streamlined, e-governance tools deployed extensively and overlapping functions rationalised. Ministries with rela­ted mandates in infrastructure, energy and hum­an development should be merged. Ministers and secretaries must be held accountable for outcom­­es. Excessive referrals to the PMO should be minimised, allowing ministries to exercise authority.

Measuring what matters: Transitioning from stabilisation to growth needs new performance indicators. Policymakers must also track indicators that directly reflect improvement in living standards and productive capacity, including provincial growth rates, employment generation, real wage growth, poverty reduction, gender and regional inequality and the number of new taxpayers entering the system. Other indicators include lending to SMEs, farm credit, microfinance, low-cost housing and public spending in backward districts.

Equally important is monitoring private investment in agriculture, manufacturing, mining, construction, transport and other productive sectors. Sustainable growth will depend not just on government expenditure but also on the willingness of private investors to expand productive capacity. The real work begins now. If policymakers use the post-budget period to establish priorities, strengthen institutions, clarify responsibilities, and monitor outcomes, future budgets will become instruments of transformation rather than annual accounting exercises.

The writer is a former State Bank governor.

Published in Dawn, June 25th, 2026

PESHAWAR: As the Khyber Pakhtunkhwa (KP) Assembly on Wednesday passed an Rs2.17 trillion budget for the fiscal year 2026-27 (FY27), bulldozing the cut motions and approving grants of all the departments, Chief Minister Sohail Afridi said the coming fiscal year will be one of peace, prosperity and development for the province.

The FY27 budget for KP was presented on June 20, with CM Afridi saying that the provincial government would not give any grants to the federal government, and that any decision on providing additional funds to the Centre would be made by PTI founder Imran Khan.

“We cannot develop unless there is peace, and this is why we have enhanced the budget for police to Rs40 billion in order to equip them, develop infrastructure, enhance capacity and remove all shortcomings,” the chief minister said today while addressing lawmakers in the KP Assembly.

The chief minister, during the session chaired by KP Assembly Speaker Babar Saleem Swati, stated that Peshawar, which was the provincial capital and gave an “overwhelming majority” to the PTI, was allocated the second-largest amount in the budget.

CM Afridi stated that with almost Rs100 billion extra, the throw forward would be reduced and there would be visible changes in the health and education sectors.

“We are bringing the Insaf Buzurg Card for people above 60 years of age so they can travel free of cost on the BRT,” he said, adding that there were huge allocations for several districts and that funds were allocated without any discrimination.

“Your federal ministers had promised the completion of the Khyber Institute of Child Health, but allocated only Rs300 million. We, through bridge financing, will complete the project,” CM Afridi told the opposition leader, the PML-N’s Dr Ibadullah Khan.

The CM stated that the dam in Swat was ready, but a no-objection certificate (NOC) was required to complete the remaining technical work and had not been issued by the federal government.

CM Afridi also said that the KP government would invest in the merged districts from its own resources.

“We did not celebrate passing the budget because we will celebrate Khan sahib’s release as the nation does not want anyone else but Khan sahib,” he said, contending that the entire country had been suffering due to the decisions taken behind closed doors.

The PTI leader stated that the party had knocked on every door, but even the provincial chief executive was refused a meeting with Imran.

“We are [tolerating it] and will tolerate it, but you will not be able to tolerate it,” he said, in an apparent reference to the federal government.

CM Afridi told the opposition leader that the Centre had been holding over Rs4tr and refusing to give the province its share in the National Finance Commission (NFC) award.

He also questioned whether the federal government brought about an industrial or agricultural revolution, claiming that the country’s imports were almost double the exports and that the trade deficit was around $36bn.

Additionally, CM Afridi noted that the GDP growth — which was once 6 per cent during Imran’s government — had dropped to 3pc.

Earlier, Ibadullah complained about bulldozing the cut motions and not allowing the opposition lawmakers to speak about the issues being faced by people in their respective constituencies.

“I was not expecting this from the chair to bulldoze cut motions by lawmakers on funds allocated for government departments. This should not have happened, and bulldozing the cut motions is unfair,” he complained.

The chair stated that powers were exercised with the consent of lawmakers from both the treasury and opposition benches.

The opposition leader claimed that not even a single penny was allocated for opposition lawmakers and asked the chief minister to carry the opposition lawmakers along with him as well.

He stated that there were potential areas where the KP government could generate revenue, but that the government had no roadmap and therefore could not develop the province since 2013.

Ibadullah stated that the energy, mines and minerals, and tourism sectors could generate huge finances for the province, adding that the pre- and post-budget debates should be considered and implemented.

Speaking in the assembly, PPP’s Ahmad Karim Kundi stated that all parties should develop a Charter of Economy and that the currently missing socioeconomic indicators must be made available.

The chief minister’s adviser on finance, Muzammil Aslam, stated that the rules of business should be framed so that the throw forward was capped, and that rules be framed for debt management and developmental projects.

KP Law Minister Aftab Alam Afridi stated that lawmakers highlighted meagre allocations, but that it was not the case.

He noted that during the outgoing FY25-26, some 323 schemes were removed, while Rs71bn were allocated for 523 schemes, which would also be scrapped.

The minister argued that although the throw forward was 7.7 years, it was less than that of the Punjab and Sindh governments.

The National Assembly on Wednesday approved a supplementary budget of Rs593.64 billion for the fiscal year 2024-2025 (FY24-25) and a sum of Rs475.05bn for the outgoing fiscal year (FY25-26).

Finance Minister Muhammad Aurangzeb moved a series of papers for approval during Wednesday’s session.

Under the Constitution, the government must secure parliamentary approval for the federal budget before any spending. This approval allows the government to spend specified funds for different heads. However, the government often seeks retrospective approval for additional amounts already spent, leaving the parliament with no choice but to regularise these expenditures.

The NA’s X account said Aurangzeb laid the Supplementary Authorised Expenditure 2024-2025 and 2025- 2026, along with other papers, before the house under Article 83 of the Constitution.

Dawn provides a breakdown of the additional amounts approved for spending during FY24-25 and FY25-26, which will conclude on June 30.

FY2024-25

The following supplementary grants were approved for FY24-25 (July 2024- June 2025):

• Rs430.10bn for Power Division
• Rs37.89bn for miscellaneous expenditure
• Rs22.84bn for defence services
• Rs22.15bn capital outlay on civil works
• Rs5.79bn for both civil and armed forces
• Rs5.61bn for Commerce Division
• Rs5.60bn for development expenditure of Finance Division
• Rs3.82bn for National Health Services
• Rs2.69bn for Federal Board of Revenue (FBR)
• Rs1.80bn for Information and Broadcasting Division
• Rs1.43bn for educational institutions under the federal government, cantonments and garrisons
• Rs1.26bn for other development expenditure
• Rs1.25bn for Defence Division
• Rs1.10bn for development expenditure of Interior Division
• Rs750m for the development expenditure of Power Division
• Rs300m for Cabinet Division
• Rs250m was approved for the federal education and professional training division
• Rs238.42m for National Food Security and Research Division
• Rs207.97m capital outlay on Petroleum Division
• Rs160.46m for Pakistan Agricultural Research Council
• Rs90.27m in respect of foreign missions
• Rs64.82m for Airports Security Force
• Rs50m for Parliamentary Affairs Division
• Rs49.65m for the Law and Justice Division
• Rs14m supplementary funds were approved for the Kashmir and Gilgit-Baltistan affairs division

The following grants were approved in “excess authorised expenditure” during FY24-25

• Rs19.03bn for the combined civil armed forces
• Rs15.63bn in development expenditure of Water Resources Division
• Rs1.19bn for Law and Justice Division
• Rs646.64m for the federal education and professional training division
• Rs508.77m for foreign missions
• Rs483.92m for superannuation allowances and pensions
• Rs17.46m for the Communications Division
• Rs2.57m for the Petroleum Division
• Rs1.28m for district judiciary, ICT

These amounted to a total of Rs593.64bn in supplementary grants and excess expenditure for FY24-25.

Charged expenditure for FY24-25

• Staff household and allowances president: Rs208.00m
• Repayment of short-term foreign credits: Rs40.34bn
• Audit: Rs63.00m
• Repayment of domestic debt: Rs2,603.86bn

These totalled to Rs2,644.48bn.

Excess charged expenditures for FY24-25

• Repayment of domestic debt: Rs1,915.92bn
• Servicing of domestic debt: Rs169.32bn
• Foreign loans repayment: Rs1.54bn
• Superannuation allowances and pensions: Rs662.85m
• Federal Tax Ombudsman: Rs81.52m
• Repayment of short-term foreign credits: Rs32.81m
• Federal Ombudsman Secretariat for Protection against Harassment of Women at workplace: Rs48,668

These totalled to Rs2,087.57bn.

FY2025-26

For FY25-26 (July 2025-June 2026), the following supplementary grants were approved:

• Rs127.41bn for grants, subsidies and miscellaneous expenditure
• Rs105.50bn for Power Division
• Rs57.18bn federal education and professional training division
• Rs33.96bn for defence services
• Rs29.66bn for National Health Services
• Rs22.35bn for poverty alleviation and social safety
• Rs19.72bn other expenditure of interior and narcotics control
• Rs13.82bn miscellaneous expenditure of Information and Broadcasting Division
• Rs13.10bn for Petroleum Division
• Rs10.00bn development expenditure of Revenue Division
• Rs7.88bn capital outlay on civil works
• Rs7.50bn for Commerce Division
• Rs6.61bn capital outlay on Railways Division
• Rs6.35bn development expenditure of Power Division
• Rs5.00bn for Housing and Works Division
• Rs4.25bn for Defence Division
• Rs4.18bn development expenditure of the federal education and professional training division
• Rs4.00bn for National Disaster Management Authority (NDMA)
• Rs3.70bn for development expenditure of IT & Telecom Division
• Rs2.37bn for federal miscellaneous investments and other loans
• Rs2.08bn for Information Technology and Telecommunication Division
• Rs1.57bn for the development expenditure of the National Vocational and Technical Training Commission
• Rs1.47bn for Information and Broadcasting Division
• Rs1.38bn combined civil armed forces
• Rs967.50m for Cabinet Division
• Rs960.27m for Interior and Narcotics Control Division
• Rs536.07m other development expenditure
• Rs344.73m development expenditure of Interior and Narcotics Control Division
• Rs250.00m for National Security Division
• Rs170.40m for Inter-Provincial Coordination division
• Rs150.00m for Climate Change and Environmental Coordination Division
• Rs112.11m for other expenditure of Finance Division
• Rs76.23m for Special Investment Facilitation Council (SIFC) Division
• Rs40.00m for the development expenditure of Defence Division
• Rs27.42m for National Food Security and Research Division

These amounted to a total of Rs475.05bn in supplementary grants for FY25-26.

Charged expenditure for FY25-26

• Repayment of domestic debt: Rs12,624.8bn
• Federal Constitutional Court of Pakistan: Rs2.25bn
• Elections: Rs455.98m

These totalled to Rs12,645.5bn.

KARACHI: Treasury and opposition lawmakers in the Sindh Assembly traded sharp criticism, albeit in cautious words, on Tuesday during the post-budget debate, with the discussion ranging from Karachi’s share in development spending to allegations of corruption, ethnic politics and administrative failure.

As many as 15 more lawmakers from the two sides of the aisle, including six ministers, spoke on the provincial budget taking the total number of speakers to 127 in the last four consecutive days of the post-budget debate.

The atmosphere in the house, however, remained largely calm compared with previous sittings, with Education Minister Syed Sardar Ali Shah urging members of both sides for a “revision of the curriculum of hate”.

He said that just as Sindhi-speaking Sindhis were an integral part of Sindh, Urdu-speaking Sindhis were also an integral part of the province. “They belong here and cannot go anywhere else,” he added.

Why are World Bank funds being spent on Karachi, where is city’s tax money, asks MQM lawmaker

The education minister said that attempts were made to fan the politics of hate and added that talk of dividing Sindh was not new. “These conversations were taking place even before the formation of the MQM,” he added.

CM Murad said that this point was made by Mahmood-ul-Haq Usmani in 1951 and later Nawab Muzaffar also said it. “If this narrative continues, how will those who consider Sindh their mother accept it?” he added.

“Karachi was, and is, an inseparable part of Sindh,” he said, adding that “Karachi collects tax; it does not generate tax”.

He said that the number of out-of-school children had declined and a Student Attendance Monitoring System was being launched with the World Bank’s support. “The department is working with Nadra to obtain B-Form data of all children,” he added.

Muttahida Qaumi Movement-P member Abdul Waseem came down heavily on the PPP saying that the party had been in power for 18 years and questioned where past funds had gone. “World Bank money is being spent on Karachi projects,” he said asking that where the money generated through taxes in the city was going.

Health Minister Dr Azra Pechuho said several reforms introduced this year would show full results in two years.

She said that vascular surgery had begun at the Karachi Trauma Centre and 50-bed hospitals had been expanded in Ancholi, Gulberg and Gulshan-i-Hadeed.

“Efforts are under way to set up a maternity home at the Children’s Hospital in Korangi No 5,” she added.

The health minister said that the SIUT was providing excellent services in Karachi and Sukkur, adding that chest pain units were being established in all districts.

Agriculture Minister Sardar Muhammad Bux Mahar said that agriculture needed to be developed on scientific lines, noting record wheat production of 4.9 million metric tons due to subsidies on fertiliser and seed.

Jamaat-i-Islami’s Muhammad Farooq said that the FBR and other agencies collected Rs7,000 billion in taxes in 2025-26, with Karachi contributing 85 to 90 per cent. “Karachi wants its rights. Neither the province nor the federation treats Karachi as a priority,” he said.

He said that of the Rs720 billion ADP, only Rs100 billion had been allocated to Karachi, whereas its share by population should be Rs400 billion.

The JI member said that K-IV required Rs40 billion and warned that the old water lines could not carry K-IV water.

He said that the S-III project was worth Rs32 billion but only Rs1 billion had been allocated.

He added that the only solution to civic problems was an empowered city government. “Local bodies should be given powers under Article 140-A,” he said.

Farooq also demanded an immediate end to the quota system, saying it had kept Karachi’s youth out of jobs.

Prisons Minister Ali Hassan Zardari said that 80km of roads in Tando Muhammad Khan, 120km in Thatta and 26km from Naushahro Feroze to Padidan had been completed, along with the Talhar-Tando Bago road.

He said that five major schemes were included in the next budget and Rs32 billion would be spent on ongoing projects.

Pakistan Tehreek-i-Insaf’s Rehan Rajput acknowledged good work in health but said spending on institutions was high.

Livestock Minister Muhammad Ali Malkani said that Sujawal was among the province’s most underdeveloped areas and needed accelerated development.

He said Sindh’s livestock population had crossed 60 million and 23.3 million small animals had been vaccinated.

Adviser on Rehabilitation Giyan Chand Essrani said that Rescue 1122 received 24,000 complaints daily and had facilitated 225,000 people in a year.

MQM-P member from Hyderabad, Rashid Khan, said that problems in several areas had persisted for years and the promises on development funds in the last budget were not fulfilled.

He cited staff shortages at Hyderabad Civil Hospital and claimed funds for some schemes were not released, calling for reforms in the bureaucracy and administrative structure.

Najam Mirza of the MQM-P said that the Provincial Finance Commission Award had not been announced.

MQM-P’s Rehan Akram said that water lines in North Karachi were being laid without planning.

He also said that not a single camera had been installed under the Safe City project since 2016.

Mahesh Kumar Hasija of the MQM-P alleged “petty corruption” in the minorities department and called for a larger raise for low-grade employees.

Later, Speaker Syed Awais Qadir Shah adjourned the house to June 27.

Published in Dawn, June 24th, 2026

• Proposed FED on mineral water, hydration drinks with low sugar content scrapped
• Local airlines get sales tax break on import of aircraft parts
• Excise duty on EVs to be linked to their dollar value; zero for cars valued under $75,000
• Traders with turnover of up to Rs200m may opt out of fixed tax regime
• Tax exemption granted for income derived from private equity, venture capital funds

ISLAMABAD : After the opposition walked out of the lower house, the National Assembly on Tuesday passed the Finance Bill 2026, while supplementary grants for the outgoing fiscal year will be tabled for approval today (Wednesday).

After all seven amendments moved by opposition members were rejected by a majority vote, Finance Minister Muhammad Aurangzeb moved the Finance Bill, including the amendments suggested by the National Assembly Standing Committee on Finance.

Some of the key changes made to the bill since its introduction in parliament include the abolition of duties on mineral water or hydration drinks, sales tax exemption for local airlines on the import or lease of aircrafts, and an amendment to the duties imposed on electric cars or SUVs imported into the country.

The government has done away with the proposed 20 per cent Federal Excise Duty (FED) on mineral waters, aerated waters, hydration drinks or electrolyte beverages with artificial sweetener or sugar content below 5g/100 ml.

Previously, all kinds of mineral waters, aerated waters, hydration drinks or electrolyte beverages were subjected to 20pc FED, irrespective of the artificial sweetener or sugar content.

The updated finance bill also included permission for all airlines operating in the country to avail sales tax exemption on the import or lease of aircrafts and their parts from July 1, 2027, which was only granted to PIA in the original bill, tabled on June 12.

EVs and SUVs

The amended Finance Bill 2026 also showed that excise duty on imported electric cars would be calculated based on their values to be calculated US dollars.

No FED will be applicable on electric cars and electric SUVs, imported in Completely Built-Up (CBU) condition with a value not exceeding $75,000, as determined under section 25 of the Customs Act, 1969.

Meanwhile, 30pc excise duty would be applicable on electric cars and electric SUVs valued between $75,000 and $110,000, while those whose value exceeds $110,000 would face 40pc excise duty.

Separately, the Device Identification, Regist­ration and Blocking System (DIRBS) tax on imported phones will now be paid in instalments, but all instalments have to be paid before the end of the financial year in which the import is made.

The amended Finance Bill 2026 approved by the NA also revealed that persons having turnover up to Rs200 million may opt out of the fixed tax regime, subject to a final and irrevocable certificate filed with the Tax Commissioner before filing their returns for the tax year 2027.

As per the amended bill, the minimum rate of value addition tax shall be one percent in the case of import of coal, subject to the conditions that such imported coal is exclusively and directly supplied to Independent Power Producers.

Some clauses relating to the Climate Support Levy in the original Finance Bill have been dropped through amendments proposed in the Petroleum Products (Petroleum Levy and Climate Support Levy) Ordinance.

Tax exemption

Under the amended bill, income tax exemptions wou­ld be available on any income derived by a private equity and venture capital fund registered under Private Funds Regulations, 2015.

This will be applicable where not less than 90pc of the accounting income of that year, as reduced by accumulated losses and unrealised capital gains, is distributed by the private equity and venture capital fund to its unit or certificate holders or shareholders.

This exemption will not be available if the private equity and venture capital fund is established to acquire a public listed company, whose status has not been changed to pri­­vate limited company on the acquisition.

In addition, the amended bill says that for steel melters, re-rollers and composite units, tax will be collected on the basis of per unit electricity consumed, including use of electricity produced by a captive power plant or through any other alternative source of energy at the rate or rates as prescribed by FBR.

The tax so collected shall be an adjustable input tax, to be claimed in the return of the month in which such payment is made. The per unit sales tax shall be determined by the FBR on the basis of minimum notified price and the industrial benchmarks of consumption of electricity against per ton production of steel products.

Published in Dawn, June 24th, 2026

The National Assembly on Tuesday passed the budget for the upcoming fiscal year during a session that saw the opposition staging a walkout.

Finance Minister Muhammad Aurangzeb moved the bill for the House to approve the budget proposals for the next fiscal year after the opposition’s walkout.

The walkout was preceded by a speech by NA Opposition Leader Mehmood Khan Achakzai, who had criticised the government over several issues.

His speech was not livestreamed on the NA’s social media platforms or on television channels, even after Speaker Ayaz Sadiq on Sunday lifted longstanding curbs on the airing and dissemination of opposition members’ speeches.

Later, Achakzai posted on X: “We have taken an oath to protect the Constitution of Pakistan. You have supported undemocratic forces in trampling the Constitution; through your vote, you have clipped the wings of the judiciary.”

According to Achakzai, this excerpt was from his address in the NA, which was “censored”.

Achakzai assails govt

Sparks flew in the House as Achakzai assailed the federal government, prompting a strong response from Speaker Sadiq.

The opposition leader began his speech by criticising Sadiq. “We will have to change our tone now that your government has completed 2.5 years,” he said, criticising Sadiq for his conduct as the speaker.

“You did not care about the Constitution and law as you dismissed 14 of your colleagues from the Assembly,” Achakzai said, seemingly referring to PTI’s disqualified members.

He also criticised the government for sentencing Baloch Yakjehti Committee (BYC)’s Dr Mahrang Baloch to life imprisonment.

The NA opposition leader further slammed the government for its response to the recent unrest in Azad Jammu and Kashmir.

Turning guns on Prime Minister Shehbaz Sharif, who was also present in the House, Achakzai referred to an earlier speech by him.

“I did not enjoy the way Shehbaz bhai spoke. He told me that we are here because Pakistan is still here, and I think he was absolutely correct in saying that,” Achakzai said. He, however, added: “But, Pakistan is not some imaginary country that exists in the skies. It means Khyber Pakhtunkhwa, Balochistan, Sindh, and Punjab. Why don’t you see KP as part of Pakistan?”

The opposition leader accused the government of “clipping the wings” of the judiciary and “trampling the Constitution”.

“Mistakes happen, but let us strengthen this House with the support it needs,” he urged.

“What are you afraid of? Call the people of Balochistan here and tell them that your children have the right to Balochistan’s resources,” he urged the prime minister. “Say the same to Sindh and KP,” he added.

In response to Achakzai’s remarks, the NA speaker said the opposition was in a “state of confusion” and held that he would not allow anyone to speak against “Pakistan, armed forces, and the judiciary”.

“If you call this a violation of the Constitution, then I am willing to commit such violations,” he remarked.

He further stated that despite the opposition questioning the legitimacy of Parliament, “you speak for more than your allotted time; does the parliament not appear fake to you then?”

Rebuking the opposition leader, Speaker Sadiq further alleged that the opposition had always refused to participate in parliamentary committees despite being asked repeatedly.

“You are in a confused state of mind,” he said, reiterating that the House stood united “when it comes to Pakistan”.

In a statement issued later in the day, he freedom of expression “must be exercised within the framework of the Constitution, rules and established parliamentary norms”.

As per the statement, he said that maintaining the sanctity and dignity of Parliament remained his foremost responsibility, adding that “democratic institutions must be respected and strengthened through constructive engagement”.

The national interest, sovereignty, and stability should remain the collective priority of all elected representatives, the statement quoted the speaker as saying.

The opposition, including Achakzai, walked out of the NA midway through his remarks. However, Jamiat Ulema-i-Islam-Fazl’s members stayed in the House.

PM hopes US-Iran MoU leads to ‘long-standing agreement’

Speaking in the House after Achakzai’s walkout, Prime Minister Shehbaz Sharif expressed hope that the memorandum of understanding signed by the US and Iran before the two sides held talks in Switzerland over the weekend would turn into a “long-lasting agreement”.

In his brief speech, he recalled the developments at the recent summit in the Swiss resort of Burgenstock, where delegations from the US and Iran held an hours-long discussion with Pakistan and Qatar participating as mediators.

“Pakistan tried its best, with complete sincerity, to bridge the distance between the two sides,” he said, adding that the dialogue that began on Sunday stretched past midnight into Monday.

He recalled that a joint statement was issued by the mediators in the early hours of Monday after the dialogue concluded, noting that technical talks would be held between the US and Iran over the next 60 days. The negotiations would also cover Iran’s nuclear assets, ballistic missiles and frozen assets, he added.

“We fully hope that the MoU will turn into a long-lasting agreement over the next 60 days, leading to peace in the world,” he hoped.

The premier went on to congratulate the nation and members of the House, including those from the opposition, highlighting Pakistan’s “key” and “historic” role in mediating between the two sides.

“The world’s renowned newspapers featured Pakistan on their front pages,” he said.

PM Shehbaz termed it a “positive narrative” regarding Pakistan, adding that “we would not have been able to achieve it even after spending billions of rupees”.

Mentioning that Iranian President Masoud Pezeshkian was due in Pakistan today, he said the day’s discussion would focus on strengthening ties between the two countries, and this was not the time to raise differences. The premier expressed this grievance, noting Achakzai’s absence.

He then responded to Achakzai’s criticism of his speech during a previous session, noting that the opposition leader had also taken exception to him thumping the desk at the time.

The premier explained that any desk-thumping by him would have been in connection with Pakistan’s diplomatic endeavours for peace between the US and Iran.

He also said remarks by him about Balochistan’s resources in his previous speech reflected his happiness over the increase in the province’s resources under the National Finance Commission.

PM Shehbaz further stated that he had also always said that just one province’s progress was not the entire country’s progress. “I have always said that Pakistan will not progress until all four provinces progress,” he said, regretting that the opposition leader presented his words “differently”.

The premier said the opposition leader had called the incumbent government “illegitimate”. The premier said in his response that 2018 elections should be investigated, and if the government that came after those polls was legitimate, the incumbent government was also legitimate.

STATE budgets mustn’t mirror boring finance ledgers that merely balance revenues and outlays. They must embody strong strategy scripts that show vividly how the state will drive progress. But reading ours is painful as one goes through over 100 unrelated petty measures that don’t add up to a gripping vision for progress. Clearly, progress isn’t a goal to pursue for our elite hybrid rulers but a prospect to fear, as it harms their dubious wealth and power. So, the new status quo federal budget makes the rich richer, the poor poorer, and the IMF and big lobbies happier. It defers yet again the state reforms and societal restructuring we urgently need to thrive. Our rulers dread them and so fail on most key aims of good budgets.

The document meets the fiscal balance aim with a deficit target of 3.6 per cent of GDP (against 7-8pc till recently) but via heist and spin. It expropriates surpluses from meek provinces to force them to cut spending by nearly 20pc, mainly uplift funds. This effectively cuts their NFC share from 57.5pc to 46pc and the share in total federal funds to only 34pc if we add federal non-tax funds, which are raised mostly in provinces. This covert heist, despite the 4pc cut in debt outlays from last year because of large interest rate cuts, was due to a fall in State Bank profits too, a rise in defence outlays after the 2025 war with India, tax relief, and the aim to avoid new taxes.

Some had hopes that growing Saudi defence ties would help with rising defence outlays. Rulers could also raise taxes on undertaxed sectors and cut waste, subsidies and state units’ losses, instead. As these steps hurt the elites, those in power cut uplift funds at all levels. Had these funds been used well there could have been less poverty and more progress. The total revenue aim is part spin as we usually miss it. So, we may have a mini-budget taxing mainly the masses or more cuts in uplift funds. There is no real increase in the revenue aim from last year over inflation, and so the tax-to-GDP ratio remains near 11pc, which is low even regionally. So, the budget fails on the fiscal expansion and devolution aims.

On the fiscal equity aim, the ratio of direct and indirect (that harm the poor most) taxes is 49:51pc against 37:63pc just three years ago. But tax progressivity rose much less because new direct taxes fell on already overtaxed sectors and persons and not undertaxed retail and other sectors. The former now get tax relief but by cutting uplift outlays. Experts think the new retail tax scheme may fail like many past ones, given missing political will. Indirect taxes and the petroleum levy, which is an indirect tax too, still rose by Rs3 trillion in three years. So, their burden on the poor keeps rising.

Clearly, progress isn’t a goal to pursue for our rulers.

To drive economic progress, industrial and export sectors will receive — besides the ongoing interest rate cuts — tariff cuts on raw materials, tax relief and SME facilitation measures. But some of them yielded few gains earlier while even new measures may fail if the rollout remains weak. Industrial policy measures — such as special zones and directed credit, industrial upgrading funds and R&D support — that had helped the Asian Tigers the most are missing. Support for agriculture, despite its many problems, and IT, despite its huge potential, is weak. So, jobs and export revenue increases remain uncertain.

On the social progress goal, health and education spending ratios to GDP remain flat from last year and much lower than those of most Asian peers. The BISP budget rises in real terms but may not dent rising poverty that now affects over 40pc of the people under the new World Bank count. Raising poverty outlays a bit when structural drivers are rising due to state policies is like throwing a band-aid at a growing, self-inflicted wound. Climate change is a huge threat for the poor but a minor priority in the budget, with no new programmes.

Finally, the document lists many measures for budget efficiency and transparency in tax collection. But many of them have had limited success previously, while new measures may fail due to weak rollout. Oddly, there is no attempt to improve the expenditure side across the four main heads: debt, defence, development and delivery.

So, the budget maintains the status quo while giving the illusion of reform and fails on almost all aims. It’s a budget to forget in terms of its banal details but not a budget to forgive for its overall lack of ambition, elite bias and assault on provincial autonomy.

The writer holds a PhD in political economy from the University of California, Berkeley, and has 25 years of grassroots to senior-level experience across 50 countries.

murtazaniaz@yahoo.com

X: @NiazMurtaza2

Published in Dawn, June 23rd, 2026

CLICHÉS are an essential part of political rhetoric. But when repeated often, they lose their impact. So when Finance Minister Muhammad Aurangzeb recently wrapped up the National Assembly debate on his ‘relief and growth’ budget — his third — his words sounded uninteresting if not outright boring.

No doubt, there are plus points. The budget gives tax relief to high-earning salaried individuals and concessional loans to farmers, and contains fertiliser subsidies and reduced duties on farm equipment. Individually, these populist measures are welcome interventions, even if none offers relief to low- to middle-income households and salaried people.

Mr Aurangzeb’s commitment to removing direct taxpayer-officer interaction through automation addresses one of our most persistent structural complaints: that the tax system harasses compliant taxpayers while leaving non-compliant ones largely untouched. And yet, a budget is not merely a list of relief announcements. It is a statement of priorities that the government feels will move the economy forward. In light of this factor, the budget raises questions that Mr Aurangzeb did not quite answer.

The minister’s main claim is that the budget for FY27 will lay the foundation for ‘sustainable, export-led growth’. It is a phrase successive governments have used, and it deserves more scrutiny than it typically receives. Export-led growth is not achieved through subsidy packages and loan schemes alone. It requires, above all, productivity and improvements in how firms produce goods and services that the world wants to buy.

On that front, the budget is conspicuously thin. There is no serious, coherent industrial policy directed at moving exports up the value chain. Development of downstream agricultural infrastructure and Chinese cooperation is welcome but there is no roadmap for increasing farm productivity for exports.

What the document does contain is a familiar reliance on real estate as the engine of near-term growth. This is not a new instinct in Pakistan’s economic management; it is, in fact, the default growth policy theme. Real estate generates activity, creates downstream demand and delivers the kind of growth that sounds good in a speech. The problem is that we have been here before more than once, and it has never ended well. Property-driven booms in Pakistan have a consistent history — they inflate, they crowd out productive investment and they eventually correct and leave behind the same structural weaknesses that made the boom necessary in the first place.

Mr Aurangzeb and others in the government have repeated their intent to broaden the tax base so often that it has lost its meaning. What value do such words have when policies are drafted to offer the untaxed real estate and retail sectors yet another way around the system. This is not to say the budget will not deliver growth. Only that it will not be sustainable.

Published in Dawn, June 23rd, 2026