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KARACHI: Defending the deficit budget for fiscal year 2026-27, Sindh Chief Minister Syed Murad Ali Shah said on Thursday that the provincial government had included no new development schemes, choosing instead to prioritise the completion of 2,056 ongoing projects.
The chief minister, who also holds the finance portfolio, on Wednesday presented a Rs3.652 trillion budget for FY2026-27 in the provincial assembly with a deficit of Rs36.9 billion.
Addressing a post-budget press conference at the Sindh Assembly Auditorium, he described the budget as a “fiscally responsible plan shaped by federal revenue shortfalls, rising expenditure pressures and economic uncertainty”.
He said that the Annual Development Programme (ADP) had been slashed from Rs1.018tr last year to Rs720 billion for FY2026-27 due to financial constraints, and the provincial government had prioritised completing ongoing projects over launching new ones.
Lists rising expenditure pressures and economic uncertainty as other factors; terms Keti Bandar port, financial centre and green energy data centre his flagship initiatives
“We are going to complete 2,056 ongoing schemes next year. There is no new development scheme in this budget,” he added.
Giving details of Sindh’s fiscal position, he said the province had received Rs1.644tr in federal transfers up to May, leaving a shortfall of Rs441bn against projections.
He said a further Rs200bn was expected before the close of 2025-26, but a gap of about Rs250bn would remain.
The chief minister said the provincial tax target for 2025-26 was Rs676bn, but collections were likely to close at Rs624bn, a shortfall of Rs52bn, adding that combined with the federal gap, the overall fiscal deficit was estimated at nearly Rs300bn.
He said the provincial government had sustained a strong development push. “Last year we announced a record Public Sector Development Programme (PSDP) of Rs1.018tr, of which Rs930bn has already been released,” he said.
He put the province’s own receipts at Rs3.038tr. With federal grants, foreign assistance and loans, total budgetary receipts for 2026-27 were projected at Rs3.525tr.
The chief minister said current expenditure had been budgeted at Rs2.560tr, including Rs260bn that Sindh would provide to the federation as a constitutional grant for national defence.
He said the province had exercised its constitutional authority to contribute funds for national defence, adding that provinces had agreed to support the federation despite their own fiscal constraints.
He said that excluding that contribution, operational expenditure stood at roughly Rs2.3 trillion.
Minimum wage raised to Rs43,000
The chief minister said salaries and employee-related costs would be Rs1.264tr in FY2026-27.
He said that ad hoc relief allowances of 2022 and 2025 had been merged into basic pay, while the minimum wage had been raised to Rs43,000 per month.
He said Rs155bn had been allocated for local governments and Rs48bn for public sector universities. “Total grants to hospitals, universities and autonomous bodies will be Rs686 billion,” he added.
The CM said that debt servicing obligations were estimated at Rs54.2bn for 2026-27.
He added that non-development expenditure had been cut from Rs61.87bn this year to Rs36bn next year.
He maintained that salaries and pensions remained the largest head of provincial spending.
He said that district-level development allocations had been capped at Rs15bn, while Rs109bn had been set aside for public-private partnership (PPP)-mode projects.
Major initiatives
The chief minister said the Pakistan Peoples Party leadership, including Asif Ali Zardari and Bilawal Bhutto Zardari, had asked the provincial government to shift from small schemes to transformative infrastructure.
He said that a key project was the long-awaited Keti Bandar deep-sea port in Thatta. “President Zardari has already taken it up with Chinese stakeholders, and talks with investors and firms are under way,” he said, adding that the port would be built through PPP mode, with the federal government invited to join.
The chief minister announced plans for a Sindh International Financial Centre in Karachi, saying work had started and three sites were under review.
“We intend to complete the project before the end of the present government’s term,” he said, adding that it would be a fully equipped facility with required connectivity, systems and services, not just a building.
The CM also unveiled a Green Energy Data Centre, modelled on the approach used in Thar. “This will be a game changer and position Sindh as a hub for green digital infrastructure,” he said.
He also announced legislation for agricultural collectives to help smallholders pool land and access larger credit lines, modern irrigation and mechanised equipment.
He noted that 93 per cent of Sindh’s farmers owned less than 25 acres and struggled to tap conventional farm financing.
The chief minister said Sindh’s PPP initiatives had won international recognition and were increasingly seen as a model for other provinces.
He cited Mai Bakhtawar International Airport, major Indus River bridges and mangrove restoration and carbon credit programmes as successful examples.
He added that federal officials had recently suggested that other provinces be briefed by Sindh on its PPP framework and implementation.
CM accuses Irsa of misrepresenting situation
The chief minister said Sindh faced a 30pc shortfall against Punjab’s 11pc shortage, calling it unfair to Sindh’s growers.
He accused the Indus River System Authority (Irsa) of misrepresenting the situation and urged federal authorities and the media to take notice. “This shortage is causing serious hardship to our farmers,” he said.
In reply to a question, he said that traffic on long-delayed University Road would be restored by the end of July.
To another question, he dismissed speculation about political changes in Sindh, expressed confidence in PPP leadership support.
Published in Dawn, June 19th, 2026
