Pakistan has announced a significant increase in its defence budget for the fiscal year 2025-26, raising military spending by 20% to 2.55 trillion Pakistani rupees (approximately $9 billion), compared to 2.12 trillion rupees in the previous year.

This surge in defence allocation follows a recent and deadly conflict with India, which saw the two nuclear-armed neighbours teeter on the brink of war after a violent attack in Indian-administered Kashmir, resulting in weeks of military escalation and casualties on both sides.

The government, led by Prime Minister Shehbaz Sharif, justified the increase as a response to heightened security threats and national security imperatives, with Sharif emphasizing the need to excel economically after what he described as a military victory over India.

The defence budget now stands as the second-largest component of Pakistan's federal expenditure, surpassed only by the massive outlay for debt servicing, which remains the country’s primary fiscal burden. Despite the sharp increase in military spending, the overall federal budget for 2025-26 has been reduced by about 7%, totalling 17.57 trillion rupees ($62 billion), as the government attempts to address its record-high public debt and comply with International Monetary Fund (IMF) requirements for fiscal discipline and reform.

This prioritisation of defence has come at a steep cost to social sectors. The budget for health has reportedly been slashed by nearly 50%, reflecting a dramatic reduction in resources allocated to public healthcare. Similarly, there have been substantial cuts in social welfare and development spending, with analysts noting that these reductions are likely intended to offset the increased defence outlay. Funding for higher education, agricultural development, and climate change mitigation—critical areas for Pakistan’s long-term stability and growth—have also been deprioritised in the new budget.

The budget announcement was met with fierce criticism from opposition lawmakers, who disrupted the parliamentary session with protests, accusing the government of neglecting essential public services in favour of military expenditure. Economists and international observers have raised concerns that these budgetary choices may undermine Pakistan’s already fragile social safety net, impede progress in human development, and exacerbate the country’s vulnerability to economic shocks and climate-related disasters.

Pakistan’s decision to sharply increase its defence budget amid an ongoing economic crisis and at the expense of health and social welfare spending underscores the government’s prioritization of security concerns over developmental needs. While officials tout economic stabilization and a projected growth rate of 4.2% for 2025-26, Pakistan’s growth continues to lag behind its regional peers, and the social costs of these fiscal choices are likely to be felt by the most vulnerable segments of the population.

Agencies