Budget 2026-27: Government Proposes Rs. 3 Trillion Allocation for Defence Services
The federal government has proposed allocating Rs. 3 trillion for defence services in the Budget 2026-27, representing an increase of 17.65 percent compared to the original allocation of Rs. 2.55 trillion in the previous fiscal year.
Finance Minister Senator Muhammad Aurangzeb announced the proposed allocation while presenting the federal budget in the National Assembly.
According to budget documents, the proposed defence budget would account for approximately 2.08 percent of Pakistan’s projected Gross Domestic Product (GDP) and nearly 16 percent of the total federal budget outlay for the upcoming fiscal year.
The revised estimates show that the previous year’s defence allocation of Rs. 2.55 trillion was later adjusted to Rs. 2.58 trillion.
Major Components of the Defence Budget
A significant portion of the proposed allocation has been earmarked for salaries and allowances of military personnel and civilian employees.
The government has proposed Rs. 967.55 billion for employee-related expenses, compared to Rs. 846.03 billion allocated in the previous fiscal year.
Operating expenses, including transportation, training, medical services, fuel, and other routine operational requirements, have been proposed at Rs. 743.46 billion, up from Rs. 704.4 billion.
The allocation for physical assets, which includes procurement of equipment and other related expenditures, is proposed at Rs. 925.83 billion, compared to Rs. 663.08 billion in the outgoing fiscal year.
Meanwhile, spending on civil works and infrastructure projects has been proposed at Rs. 363.16 billion.
Military Pensions and Administration
Military pensions are budgeted separately from defence services expenditure. The government has proposed Rs. 822 billion for pensions of retired military personnel under the federal pension budget.
In addition, Rs. 10.9 billion has been allocated for defence administration expenses.
Budget Priorities for 2026-27
The proposed increase comes as the government balances fiscal management with spending requirements across various sectors.
Alongside defence expenditure, the federal budget includes approximately Rs. 1 trillion for development projects. This includes Rs. 25.1 billion for healthcare initiatives under federal institutions and Rs. 46 billion for higher education.
The Budget 2026-27 is currently subject to parliamentary approval before its final implementation.
