The development budget utilisation in Pakistan has increased to 61 percent of the re-revised Public Sector Development Programme (PSDP) allocation, following a significant 17 percent reduction in the budget. According to official data obtained by The Nation, ministries, divisions, and corporations utilised Rs506.952 billion during the first ten months (July to April) of the fiscal year 2025-26, against the re-revised PSDP allocation of Rs837.160 billion.
However, this utilisation remains below 50 percent of the original Rs1,010 billion PSDP allocation for the fiscal year. Ministries and divisions have utilised Rs369.716 billion, representing 64 percent of their total re-revised allocation of Rs577.149 billion. The Ministry of Planning has issued authorisations for nearly 99 percent, or Rs573.332 billion, of the re-revised allocation to these entities.
Similarly, corporations including the National Highway Authority (NHA) and NTDC/PEPCO have utilised 53 percent, or Rs137.235 billion, of their re-revised allocation of Rs260.011 billion. The Planning Ministry has issued 100 percent authorisation to these corporations.
It is noteworthy that the federal government imposed a cut of approximately 17 percent, or Rs173 billion, on the PSDP to fund subsidies on petroleum products. As a result of these two cuts, the federal PSDP was reduced from Rs1,010 billion to Rs837 billion.
Underutilising Ministries
Some ministries and divisions have recorded utilisation rates below 15 percent during the first ten months. These include the Board of Investment (11 percent), the Ministry of Kashmir Affairs, Gilgit-Baltistan, and SAFRON (7 percent), and the Ministry of Religious Affairs and Inter-Faith Harmony (0 percent).
Out of the total PSDP allocation of Rs837.160 billion, authorisation for the release of Rs833.343 billion (nearly 100 percent) has been issued to ministries, divisions, and corporations during the first ten months of the fiscal year.
Fund Release Strategy
According to the Finance Division's strategy for the release of development budget funds for FY2025-26, funds are to be released at 15 percent for the first quarter, 20 percent for the second quarter, 25 percent for the third quarter, and 40 percent for the fourth quarter. The ministry has been authorised to devise a quarterly sector, project, and division-wise strategy for the release of PSDP funds.
The Cabinet Division reported utilisation of Rs44.028 billion, which is 70 percent of its total allocation. The highest utilisation of Rs150.270 billion, against a re-revised allocation of Rs201.283 billion, was made by provinces and special areas, accounting for 75 percent of the total revised allocation.
The Higher Education Commission utilised 71 percent, or Rs24.850 billion, of its re-revised allocation of Rs34.906 billion. The Ministry of Water Resources utilised 66 percent, or Rs69.852 billion, against a re-revised allocation of Rs106.640 billion.
Among corporations, the National Highway Authority utilised 46 percent, or Rs84.456 billion, of its re-revised allocation of Rs174.869 billion during the first ten months. NTDC/PEPCO utilised 70 percent, or Rs52.659 billion, of its re-revised allocation of Rs75.142 billion.
