Imran Zakir
KARACHI: Sindh Chief Minister Syed Murad Ali Shah on Tuesday presented a Rs3.562 trillion provincial budget for the fiscal year 2026-27, proposing no new taxes, a seven percent increase in salaries and pensions, a Rs720 billion development programme, and a Rs13.2 billion social protection package.
Presenting the budget in the Sindh Assembly, the chief minister said the provincial government had framed the financial plan in a challenging economic environment marked by inflationary pressures, rising energy costs, climate risks, geopolitical uncertainty and continued financial difficulties for ordinary citizens.
The budget estimates total receipts at approximately Rs3.525 trillion against total expenditure of around Rs3.562 trillion, leaving a projected deficit of about Rs36.936 billion.
Syed Murad Ali Shah said Pakistan’s economy had shown signs of recovery during the outgoing fiscal year, but the impact of inflation, high utility costs and rising living expenses continued to burden the common man. He said the Sindh government had therefore focused on relief, development and social protection while maintaining fiscal discipline.
He said the budget strategy for the coming financial year was based on four principles: safeguarding Sindh’s constitutional rights, ensuring fiscal sustainability, contributing to national economic stability and continuing investment in public welfare.
The chief minister said the provincial government had been compelled to reduce its development portfolio from a projected Rs575 billion to Rs400 billion after contributing towards national strategic requirements under a negotiated arrangement with the federal government. However, he maintained that priority projects and essential public services had been protected despite the difficult fiscal situation.
“Even in a difficult fiscal environment, we have protected priority development projects and essential public services that directly affect the lives of our people,” he said.
Announcing relief measures, Syed Murad Ali Shah said no new taxes would be imposed in the next fiscal year. He said the government had instead introduced measures aimed at supporting education, agriculture, employment, insurance and small business-related sectors.
Among the tax relief measures, sales tax on education support services has been reduced to five percent. Concessional tax rates for overseas employment recruiting agencies and beauty salons integrated with point-of-sale systems will continue, while tax relief has also been proposed for insurance agents and brokers.
The agriculture sector has also been given relief through an increase in the exemption threshold for agricultural super tax from Rs150 million to Rs500 million. The applicable rate has also been reduced from 10 percent to eight percent.
The chief minister announced a seven percent increase in salaries and pensions for public sector employees and pensioners with effect from July 1. He said the salary increase had also been granted by amalgamating the Adhoc Relief Allowances of 2022 and 2025. The minimum wage has been increased from Rs40,000 to Rs43,000 per month.
Syed Murad Ali Shah said the government remained committed to protecting vulnerable groups from economic hardship. He announced a Rs13.2 billion social protection package, which includes the Kitchen Garden Initiative, Benazir Hari Card Programme, Benazir Women Agriculture Workers Programme, and support schemes for widows and orphans.
On the development side, the Annual Development Programme for FY27 includes major allocations for key sectors. Education has been allocated Rs25.9 billion, health Rs17.4 billion, local government and municipal infrastructure Rs121.6 billion, public health engineering Rs40.9 billion, irrigation Rs30.9 billion, transport and communications Rs39.5 billion, and agriculture and livestock Rs6.3 billion.
The chief minister said Sindh had achieved the highest development spending in its history during the outgoing fiscal year, releasing more than Rs900 billion for development activities despite inflationary pressure and rising construction costs.
Referring to reconstruction after the devastating floods of 2022, Syed Murad Ali Shah said one million houses had already been completed under the Sindh Peoples Housing for Flood Affectees Programme. He said financing arrangements had been secured for approximately 1.7 million housing units with international support amounting to $1.675 billion.
He said the housing programme had also empowered women by transferring land ownership rights to hundreds of thousands of female beneficiaries.
A major part of the budget speech focused on a new generation of large-scale public-private partnership projects aimed at transforming Sindh into a regional hub for trade, finance, technology, renewable energy and sustainable development.
The chief minister said Sindh’s PPP framework had received international recognition, including appreciation from the United Nations Economic Commission for Europe, The Asset magazine and The Economist. He said Sindh had emerged as one of the most successful sub-national PPP models in Asia.
Building on this progress, the provincial government plans to launch several transformational projects through PPP arrangements. One of the flagship initiatives is the proposed development of Keti Bandar as a maritime, logistics, industrial and energy hub.
Syed Murad Ali Shah said Shaheed Zulfikar Ali Bhutto had launched Port Qasim, while Chairman Bilawal Bhutto had directed him to initiate the Keti Bandar project.
He said the government would undertake an internationally benchmarked viability assessment for the establishment of a modern coastal economic corridor. The project would include port infrastructure, industrial zones, logistics and warehousing facilities, export-oriented manufacturing clusters, energy projects and multimodal transport connectivity.
The chief minister said the proposed Keti Bandar project would also explore linkages with the Dhabeji Special Economic Zone, Thar’s energy resources and emerging regional trade routes.
He said the Sindh government’s budget for 2026-27 was not merely an annual financial statement but a roadmap for economic resilience, social protection and long-term development of the province.
