Pakistan has set an economic growth target of 4% for fiscal year 2026-27, proposing a national development outlay of Rs. 3.67 trillion, with infrastructure, transport and energy projects receiving the largest share of development spending, according to official documents presented at a meeting of the National Economic Council (NEC) on Tuesday.
The NEC, chaired by Prime Minister Shehbaz Sharif, reviewed the Annual Plan for FY27, macroeconomic targets and federal and provincial development programs ahead of the presentation of the federal budget. According to available documents, Pakistan’s nominal gross domestic product (GDP) is projected to increase to Rs. 143.6 trillion in FY27 from Rs. 126.9 trillion in the outgoing fiscal year. The government has also set an inflation target of 8.2%, compared with an estimated 6.7% in FY26.
Sectoral growth targets have been fixed at 3.6% for agriculture, 4.5% for industry and 4.2% for services, compared with estimated growth rates of 2.9%, 3.5% and 4.1%, respectively, during the current fiscal year.
The proposed National Development Outlay totals Rs. 3.669 trillion, including a federal Public Sector Development Program (PSDP) of Rs. 1 trillion, provincial Annual Development Programs (ADPs) of Rs. 2.218 trillion and development spending by federal state-owned enterprises of Rs. 451 billion.
Infrastructure remained the government’s top priority, with an allocation of Rs. 602.5 billion, accounting for more than 60% of the federal PSDP. Within the infrastructure sector, Rs. 355.9 billion has been earmarked for transport and communications projects, Rs. 116.2 billion for energy schemes, Rs. 75.8 billion for water resources projects and Rs. 54.6 billion for physical planning and housing.
The social sector has been allocated Rs. 180.6 billion, including Rs. 74.5 billion for education and higher education, Rs. 22.1 billion for health and Rs. 63 billion under the Sustainable Development Goals (SDGs) Achievement Program, which largely finances development schemes proposed by members of Parliament.
Among major projects, the government plans to allocate Rs. 100 billion for the Karachi-Quetta-Chaman N-25 Highway, Rs. 30 billion for the Sukkur-Hyderabad Motorway (M-6), Rs. 26 billion for Mohmand Dam, Rs. 25 billion for the Main Line-1 railway modernization project, Rs. 25 billion for the Sindh Coastal Highway and Rs. 21 billion for the Dasu Hydropower Project.
The documents also propose Rs. 22 billion for the construction of Daanish Schools, Rs. 21 billion for a road project linking Nawabshah and Ranipur, Rs. 17 billion for flood resilience and mitigation projects and Rs. 14 billion for the Diamer-Bhasha Dam.
Special areas, including Azad Jammu and Kashmir and Gilgit-Baltistan, are expected to receive Rs. 88.8 billion, while Rs. 56.1 billion has been earmarked for the merged districts of Khyber Pakhtunkhwa. Provincial development spending is projected at Rs. 2.218 trillion, with Punjab allocated Rs. 749 billion, Sindh Rs. 706 billion, Khyber-Pakhtunkhwa Rs. 455 billion and Balochistan Rs. 308 billion under the proposed framework approved by the NEC.
The government expects Pakistan’s external account to come under pressure as economic growth accelerates. According to the plan, the current account deficit is projected to widen to $3.599 billion, equivalent to 0.7% of GDP, in FY27 from an estimated $1.082 billion, or 0.2% of GDP, in the outgoing fiscal year.
Goods exports are targeted to increase to $32.85 billion from $30.31 billion, while goods imports are projected to rise to $70.02 billion from $66.30 billion. Workers’ remittances are expected to reach $42.39 billion, compared with an estimated $41.28 billion this year.
The development framework signals the government’s intention to accelerate infrastructure investment and economic growth while maintaining fiscal discipline under its ongoing reform program.