Pakistan’s finance ministry revises federal development budget down by PKR 300 billion

The Ministry of Finance has announced plans to revise the federal development budget through surrender orders, according to sources.

The ministry has requested the return of development funds exceeding the revised Public Sector Development Program (PSDP) for fiscal year 2024-25, aiming to prevent audit objections.

Sources within the ministry revealed that a letter has been sent to all federal ministries and divisions to implement the decision.

Initially, the federal development program for the current fiscal year was approved at PKR 1,400 billion, with ministries and divisions submitting demand orders and grants accordingly. However, the PSDP was later revised to PKR 1,100 billion.

The ministry has emphasized the priority of issuing surrender orders in favor of the Ministry of Finance. Funds exceeding the revised PSDP will either be surrendered or adjusted, sources confirmed.

PSDP has shown sluggish progress, with only PKR 173.9 billion spent out of the PKR 1,100 billion allocated for the fiscal year during the first eight months of 2024-25. This amounts to 28.4% of the total allocation, signaling a gap in the expected pace of development expenditure.