Pakistan has presented its federal budget for the fiscal year 2026–27, with a total outlay of Rs. 18.77 trillion. The budget reflects a focus on higher defence spending while reducing development expenditure compared to previous years.
Finance Minister Muhammad Aurangzeb announced that the country’s economy recorded growth of 3.7%, reaching a total size of $452 billion. He said this is a major milestone for the national economy and shows signs of gradual improvement.
According to the budget details, per capita income in Pakistan has increased to $1,901. The country’s foreign exchange reserves have also improved, crossing $17 billion. In addition, remittances reached $38 billion during the first 11 months of the fiscal year, supporting external financial stability.
The government has also proposed a 7% increase in salaries for federal government employees as part of relief measures for public sector workers. Officials said this is intended to help manage rising living costs and provide some financial support to employees.
For future planning, the government has set a 4% economic growth target and an 8.2% inflation target for the coming year. These targets reflect expectations of moderate growth along with continued price pressures in the economy.
However, the unemployment rate has increased to 7.1%, showing ongoing challenges in job creation and labour market stability. Authorities say addressing employment will remain a key priority in future economic policies.
