Pakistan releases PKR 46 billion development funds in two months

The Pakistan government has released PKR 46 billion in the first two months of the current fiscal year from the total funding approval of PKR 150 billion, said the Ministry of Planning report.

The funding approved amounts to PKR 150 billion out of PKR 1,000 billion approved in July, August from the total outlay of PKR 1,000 billion planned for this fiscal year.

According to the report, the ministry authorized PKR 150 billion as part of the Public Sector Development Program (PSDP) during July and August, the first two months of the fiscal year.

PSDP is a mechanism through which the federal government funds major development projects across the four provinces, Azad Kashmir, and Gilgit-Baltistan. Over the past few years, the PSDP has shrunk to just 0.77% of GDP, its lowest level in a decade, as the economic crisis worsened with the government strapped for cash. For the past 2-3 years, PSDP allocations have consistently been underutilized, a sharp departure from the pre-FY21 trend when they were generally met.

Pakistan closed out the last fiscal year 2024-2025 with a 96% utilization of the PKR 1,045 billion allocated as PSDP.

According to the report, the ministry also approved five new projects through the Central Development Working Party (CDWP) — a forum that okay major development projects — in August 2025, while nine were recommended to the Executive Committee of the National Economic Council (ECNEC), the final approving authority for large-scale development projects.

Flood Response

The report noted the monsoon-induced floods inflicted catastrophic damage across Pakistan. In response, the federal and provincial governments evacuated 936,000 people and established 1,378 relief camps to provide immediate assistance.

The Ministry of Planning has activated its Reconstruction and Rehabilitation Unit (RRU) — originally established following the 2022 floods — to lead coordinated damage assessments in collaboration with Provincial Disaster Management Authorities, federal and provincial ministries, and district administrations.