ISLAMABAD (Staff Report) – Finance Minister Ishaq Dar presented a Rs. 4.4 trillion Federal Budget for the Fiscal Year 2016-17 in the National Assembly on Friday (today).

According to information available with Daily Pakistan Global, 38% of total budget has been allocated for development sector, around 31% for payment of foreign debts, 19% as military expenditures, 7.9% for provision of services and 3.8% on the account of different subsidies for public.

Read More: LIVE: Finance Minister unveils Federal Budget 2016-2017

Development Budget: 

Finance Ministry has set aside Rs. 1675 billion for different development projects during the Fiscal Year 2016-17. Out of this, Rs. 800 billion will be spent on the Federal Development Program while the remaining Rs. 875 billion will go to all four provinces as per their allocated shares.

Roads and Railways:

The largest portion of Federal Development Budget (Rs. 188 billion) has been allocated to the National Highway Authority while Pakistan Railways has been allotted Rs. 41 billion for Fiscal Year 2016-17 and Rs. 5.28 billion has been set aside for Communications.

Education, Health and Basic Facilities:

Under the 2016/17 budget, the Higher Education Commission (HEC) will be given Rs. 21.48 billion and an additional amount of Rs. 2.22 billion will be spent on federal educational institutions.

Rs. 24.95 billion have been allotted to the Health Sector and Rs. 31.71 billion to clean water projects. Moreover, Rs. 12 billion will go to the Planning Ministry while Rs. 6.55 billion is to be spent on Housing Division.

Additionally, Rs. 170 million have been allocated to the Human Rights Division.

Shipping and Aviation:

In FY 2016/17, Rs. 12.82 have been earmarked for Ports and Shipping, while Rs. 4.69 billion will be spent on Aviation.

Kashmir, GB and FATA:

Rs. 25.75 billion will be spent on on Kashmir and Gilgit-Baltistan. The Ministry for States and Frontier Regions (SAFRON) has been allocated Rs. 22.30 billion.


Another Rs. 136 million have been allotted to the Establishment Division, whereas the Cabinet Division will receive Rs. 370 million during the current fiscal year, which commenced on June 1. Finance, CAD, Industrial Production and Commerce Ministries will get Rs. 9.20 billion, Rs. 5.28 billion, Rs. 90.95 billion and Rs. 790 million, respectively.


Rs. 1.27 billion has been set aside for Climate Change related projects in the budget for FY 2016/17.

Foreign Debt: 

This year the Finance Ministry has proposed that Rs. 1354 billion should be allocated for payment of foreign debt.

Defense Budget:

Armed Forces have been allocated Rs. 860 billion for FY 2016-17, while an additional Rs. 2.52 billion have been set aside for Defense Development.


Rs. 348 billion will be spent on provision of services.

 Increase in Salaries and Pensions:

An overall increment of 10-12% has been proposed in the salaries and pensions of government employees.

The budget specifies three options for how this salary increment may take effect:

Option 1: a) 50% Adhoc Allowance to be merged in Basic Pay; b) Medical Allowance to be increased by 20-25%; c) 7% increase in Basic Pay.

Option 2: a) Merging two Adhoc Allowances, amounting to 10% each, in Basic Pay; b) Medical Allowance to be increased by 10%; c) 10%-12% increase in basic salary.

Option 3: a) Merging three Adhoc Allowances in Basic Pay, amounting to 10%, 10% and 7.5%; b) Medical Allowance to be increased by 25%; c) Overall 10% increase in Basic Pay.


Rs. 169 billion has been set aside to fund different subsidies which provide relief to general public.

A Comparison with Budget 2015-16:

  • The overall budget has remained the same: around Rs. 4.4 trillion
  • In year 2015-16 Rs. 1513 billion (Federal: Rs700 billion Provincial: Rs813 billion) were allocated for Development Programs as compared to this year’s Rs. 1675 billion.
  • The allocation for payment of foreign debts has gone down to Rs. 1354 billion from Rs. 1596 billion
  • Defense spending has risen to Rs. 860 billion from last year’s Rs. 781 billion
  • Health budget has been changed to Rs. 24.95 billion from Rs. 20.88 billion
  • Only Rs. 21.48 billion has been given to the HEC compared to Rs. 71 billion in the last budget.
  • Budget allocated for clean water facilities remained the same at around Rs. 31 billion

Sources have added that government is likely to announce a special package for the promotion of agriculture sector in the budget for FY 2016/17.

Related: Budget 2016-2017: Rs 341billion allocated for uplift of agri-sector