As Pakistan is ready to present the Federal Budget 2026-2027, the maritime industry is at a critical juncture. National budget discussions are usually dominated by debates on tax and tariff, inflation, debt servicing and fiscal consolidation, while the country’s maritime economy is one of the least tapped growth engines. Pakistan’s coastline is over 1000 km long with strategic location and access to major international shipping routes and Karachi Port, Port Qasim and Gwadar Port. However, spending in the maritime sector is still a small portion of the national development budget. The federal government has budgeted Rs 3.465 billion for the Ministry of Maritime Affairs under the Public Sector Development Program (PSDP) FY2025-26. Six projects were funded such as the modernization of the Gadani Ship Recycling Industry, development of the Gwadar Blue Economy Centre Phase-I, land acquisition for Gwadar Master Plan, port related infrastructure projects etc. However, this allocation was only about 0.35 per cent of the total federal PSDP of Rs 1 trillion, indicating the fiscal priorities accorded to the maritime sector. This is especially significant since over 90 per cent of Pakistan’s international trade both in terms of volume and value is carried out by sea, and the country’s ports are important gateways for regional and international trade.
Source: Ministry of Maritime Affairs, Planning Commission PSDP Documents, APCC FY2026-27 discussions.
The federal PSDP ceiling is projected to rise to around Rs 1.126 trillion for FY2026-27, thereby continuing the development thrust of the government in the face of challenges of budget constraints and IMF commitments, as per the pre-budget discussions. While no official allocation has been made yet, there are some on-going projects and discussions in the policy area that show that funding for maritime affairs may go up to Rs 4 – 5 billion. Such an increase will facilitate the continuation of Gwadar infrastructure related to the port, further development of the Gwadar Blue Economy Centre, modernization of port logistics, extension of maritime industrial activities and modernization of ship recycling infrastructure. Despite an increase, however, maritime allocations would still be a relatively small part of overall development spending.
While the expected allocation is welcome, it also underscores the bigger issue that Pakistan’s maritime development policy has been narrow in its focus, and is predominantly based on conventional infrastructure. Ports and logistics investments are critical, but the blue economy is more than just about infrastructure. It includes fisheries and aquaculture, coastal tourism, marine biotechnology, shipping services, renewable ocean energy, maritime technology, marine scientific research, and coastal ecosystem management. These sectors collectively offer vast export diversification opportunities, employment opportunities, innovation, and sustainable development opportunities.
The current budgetary framework shows that there is significant shortfall in funding the blue economy. The funds available are still largely channeled into classic infrastructure investments, and relatively small amounts are invested in the value added maritime sectors that can provide sustainable economic benefits. For instance, Pakistan’s fisheries sector has a great export potential, yet there are still issues like the adoption of outdated fishing methods, lack of cold-chain infrastructure, processing capacity, and research support that need to be addressed. Likewise, the potential of the country’s vast coastal tourism has not been fully capitalized on, because tourism investment in the region is limited in tourism infrastructure, connectivity, environmental management and destination development.
The significance of maritime investment has been further highlighted by recent developments in geopolitics and economics. The strategic importance of the ports of Pakistan, especially Karachi, Port Qasim and Gwadar, has been growing due to disruption in regional shipping routes and changing patterns of international trade. Meanwhile, the country has new opportunities to carry out investment and climate financing, and technology partnerships, as the international interest in the development of sustainable blue economy grows. Maritime investment should not be considered a sectoral investment any longer, but rather a strategic national investment that can contribute to the overall national economic goals as indicated by these developments.
Budget 2026-27 is thus a chance to transcend the incremental approach of allocations to implement a more holistic blue economy approach. The establishment of a dedicated National Blue Economy Development Fund will offer the opportunity for targeted financing of innovation, entrepreneurship, fisheries modernization, marine research, coastal development and new maritime industries. The use of public-private partnerships and access to blue finance and international climate finance mechanisms could be enabled by such a fund. Likewise, the government can progressively raise the level of the maritime sector in the PSDP. The sector’s role in trade, logistics, food security and economic development, makes it clear that more should be invested in maritime priorities in the development agenda and the investment would yield significant returns in the long term. Further private-sector participation and investment may be encouraged by fiscal support for shipbuilding/ship repair, fisheries processing, aquaculture development, maritime logistics and coastal tourism.
It should also be noted that specific focus needs to be given to fisheries and aquaculture. Modern fishing vessels, cold-chain systems, fish processing plants, certification requirements and sustainable aquaculture projects would help boost seafood exports and enhance lives of fishermen in the coastal areas. Tourism development in the coastal areas, particularly building eco-tourism infrastructure, improving the transport infrastructure, expanding and developing the hotel and hostel industry, and protecting the environment can generate additional jobs and diversify local economies. The development of human capital should also be a major part of the maritime strategy of Pakistan. Skilled workforce is essential for innovation, research and industrial growth and, therefore, for the growth of the blue economy. The budget should therefore include provisions to enhance maritime education and training, vocational training, specializations of scholarships, research grants and linkages between universities and industry, including marine sciences, maritime management, fisheries technology, coastal resource management and naval architecture. More investment in scientific research of the marine environment would also help in better understanding of the marine resources and for taking evidence based decisions.
Within this general context, the port of Gwadar is of particular importance. Although a lot of effort has been invested in the development of the port, for the future it is necessary that the city becomes a major pole for development of blue economy that combines logistics, fisheries, tourism, education and research, entrepreneurship and industrial development. Future investments in the region’s infrastructure should be matched by support for the broader economic system needed to develop the region sustainably. Special attention needs to be given to the promotion and creation of blue education through the establishment of academic programs, research centers, vocational training institutes and innovation hubs in the fields of marine sciences, fisheries, maritime management, coastal resource management and ocean-related technologies. Investing in blue education will enable the development of a skilled workforce, increase public awareness, foster research and innovation and ensure that coastal communities are responsive, competent and actively engaged in the new opportunities of the blue economy.
A comparison of allocations for FY2025 – 26 and expectations for FY2026 – 27 shows that there are grounds for cautious optimism about the sea transport budget rather than a radical change in maritime budgeting. The overall medium-term allocation of development funding is expected to rise and maritime projects are likely to be supported to a greater extent, but Pakistan remains allocating a small percentage of public funds to a sector that has significant economic potential. The task for the policy-makers is therefore not just to allocate more to the maritime sector but to ensure that investments in the sector are contributing to a wider vision of blue growth. Such a vision should acknowledge that education and research and human capital development are critical enablers to maritime competitiveness, along with infrastructure, logistics and industrial expansion.
Hence, the effectiveness of Budget 2026-27 is not solely dependent on the volume of maritime funding but rather whether maritime funding is used to support a more diversified, innovative and competitive maritime economy. With a holistic vision of a blue economy with fisheries, tourism, shipping & logistics, research & development, blue education, and coastal development, the Pakistan maritime economy can become a major contributor to exports, jobs, investments, and sustainable growth. This nation’s coast is a more than geographic asset, it is an economic frontier and a classroom for future generations. Budget 2026-27 is an opportunity to invest in the knowledge, skills and innovation ecosystem needed to realize the potential of Pakistan’s blue frontier, in addition to investing in maritime infrastructure.
