Islamabad: The Federal Government of Pakistan has unveiled a Rs18.771 trillion budget for the fiscal year 2026-27, placing major emphasis on debt servicing, defence spending, and revenue mobilization.

According to official budget documents, Rs8.054 trillion has been allocated for debt servicing and interest payments, making it the largest expenditure head in the federal budget. Pension costs have been set at Rs1.169 trillion, while defence expenditures stand at Rs3 trillion. An additional Rs1.071 trillion has been earmarked for administrative expenses of the defence sector.

On the revenue side, the Federal Board of Revenue has been assigned a tax collection target of Rs15.264 trillion. Non-tax revenues are projected at Rs5.336 trillion, while Rs161 billion is expected through privatization.

The government has also allocated Rs1.091 trillion in subsidies and fixed the size of the Public Sector Development Programme (PSDP) at Rs1 trillion to fund ongoing and new development projects across the country.

The budget reflects continued fiscal pressure from debt obligations while maintaining allocations for defence, pensions, and development spending alongside ambitious revenue targets.