The federal government has proposed allocating Rs1 trillion for the Public Sector Development Programme (PSDP) for the 2026-27 fiscal year, with major funding earmarked for infrastructure, water, energy and provincial development projects.
According to budget proposals, more than Rs682.48 billion has been allocated for development projects of federal ministries and divisions, while the overall federal PSDP has been proposed at Rs1 trillion.
The National Highway Authority (NHA) is set to receive Rs224.51 billion, making it one of the largest recipients of development funding under the proposed programme.
The Water Resources Division has emerged as the largest sectoral beneficiary, with a proposed allocation of Rs103.80 billion for water-related projects, including dams, reservoirs and irrigation infrastructure.
The government has also proposed allocating Rs88 billion for projects under the Power Division, including the National Transmission and Despatch Company (NTDC) and Pakistan Electric Power Company (PEPCO).
Under the development programme, the Cabinet Division is proposed to receive Rs64.08 billion, while the Higher Education Commission (HEC) has been allocated Rs46 billion for higher education and research initiatives.
The Railway Division is expected to receive Rs40.65 billion, while the Federal Education and Professional Training Division has been allocated Rs36.31 billion for education-related projects.
A total of Rs233.33 billion has been proposed for provinces and special areas. Of this amount, more than Rs56.07 billion has been earmarked for the merged districts of Khyber Pakhtunkhwa.
The proposals also include Rs10.1 billion for development projects in Azad Jammu and Kashmir and Gilgit-Baltistan.
For the Information Technology and Telecommunication Division, the government has proposed an allocation of Rs19.58 billion, while the National Health Services Division is expected to receive Rs16.60 billion.
The Interior Division has been allocated proposed development funds of Rs21.82 billion.
The government has also proposed allocating Rs1 billion for new projects under the second phase of the China-Pakistan Economic Corridor (CPEC 2.0).
In addition to the federal PSDP, the development programme of government institutions has been proposed at Rs2.218 trillion. Combined with provincial allocations, the total size of the National Development Programme for 2026-27 has reached Rs3.669 trillion.
The proposed allocations are expected to be formally presented as part of the federal budget for the upcoming fiscal year and will finance key infrastructure, energy, education, health and regional development projects across the country.
Reporter: Waqas Azeem