Budget 2026-27: What Are the State’s Priorities? Economic Stability or a Debt Trap?

Pakistan’s Budget 2026-27 has now been presented. Government ministers are describing it as a budget of economic stability, growth, and prosperity, while the opposition and many economists view it as a form of statistical wizardry that bears little connection to the realities of ordinary citizens. The key question, therefore, is: what is the truth? Is Pakistan genuinely moving toward economic recovery, or are we once again pushing our problems into the future through increased borrowing?

Senior journalist Haroon Rasheed recently wrote a sentence that perhaps summarizes the entire budget debate. According to him, only one of two things can survive: the power plants owned by elite families or the national economy. The government's choice, he argues, is clear: let the country suffer, but ensure the survival, security, and prosperity of the ruling elite at any cost.

Although this is a harsh observation, a close look at the budget figures inevitably raises questions about the state's actual priorities. The total budget size stands at Rs. 18.771 trillion. The government expects to generate Rs. 15.264 trillion through taxes and another Rs. 5.335 trillion from non-tax sources. After transferring the provinces’ constitutional share under the NFC Award, the federal government will be left with approximately Rs. 11.751 trillion in resources.

However, this is where the real story begins. Debt servicing and interest payments alone require Rs. 17.495 trillion. Defense expenditures have approached Rs. 3 trillion, while pension payments are expected to consume Rs. 1.169 trillion. In other words, an amount far greater than the government's available resources is consumed by these mandatory expenditures alone.

This naturally raises a series of critical questions. Where will funding for education come from? How will healthcare be improved? Where is the investment for industrialization, agriculture, employment generation, research, and development projects? These are questions that budget speeches often fail to answer.

Even more surprising is the fact that in a country where millions of children remain out of school, universities face severe financial challenges, and research funding is extremely limited, only a modest allocation has been made for education. Meanwhile, Rs. 850 billion has been allocated to the Benazir Income Support Programme (BISP).

Helping the poor is undoubtedly a responsibility of the state. However, nations do not achieve long-term prosperity through continuous financial assistance alone; they progress through education, skills development, and employment opportunities. If young people are denied access to quality education, modern technology, and meaningful jobs, welfare payments may not lift them out of poverty. Instead, they risk creating greater dependence on the state.

This is why a concerning trend appears to be emerging in Pakistan. Rather than eliminating poverty, the state seems increasingly focused on managing it. Instead of empowering citizens to become self-sufficient, policies appear to be integrating them into an expanding welfare system.

At the same time, development funds and special allocations continue to be reserved for government legislators. At a time when citizens are struggling under the weight of inflation, unemployment, and increasing taxes, special privileges for the political elite can be seen as adding insult to injury.

A statement by Shehryar Khan Mehr reflects public sentiment: "The government starts each day looking for any relief available to ordinary people, only to come back and take that relief away as well."

This explains why many citizens find it difficult to relate to official claims of economic progress. While government officials speak of development and stability, ordinary people evaluate economic conditions through their electricity bills, gas bills, fuel prices, and the cost of everyday necessities. From that perspective, the promised stability often remains invisible.

The government's position is that inflation has declined, foreign exchange reserves have improved, and the economy is moving toward stability. However, the strength of an economy cannot be measured solely by lower inflation figures or a slightly stronger currency. The true indicators of economic health are different: How many new industries are being established? How many jobs are being created? How much are exports increasing? And how many opportunities are being generated for the country's youth?

Unfortunately, the current budget appears to provide fewer answers to these questions and more reasons for concern.

The issue is not the overall size of the budget. The real question is how much of this budget is dedicated to Pakistan’s future. If, after debt repayments, pensions, and other non-productive expenditures, there are insufficient resources left for development, then claims of economic stability become little more than a numbers game.

Nations do not prosper through debt; they advance through knowledge, industry, and production. The government insists that the economy is improving, yet the statistics themselves raise an uncomfortable question: if everything is getting better, why does the country still require additional borrowing every year simply to function and grow?

Perhaps this is the one question whose answer cannot be found in budget documents—it can only be found in the empty pockets of the people.