Sindh to present FY27 budget amid spending curbs, possible relief measures

KARACHI: The Sindh government is due to present its budget for the 2026-27 fiscal year on Wednesday, with the financial plan expected to reflect fiscal pressure, lower development spending and possible relief steps for employees and the wider public.

Chief Minister Syed Murad Ali Shah, who also holds the finance portfolio, will lay out the budget in the Sindh Assembly at 2pm after it is cleared by the provincial cabinet in a meeting scheduled earlier in the day. This will be the 11th time he presents Sindh’s annual budget, the highest number in the province’s parliamentary history.

The budget is being prepared at a time when expenditure demands are pushing the government towards prioritising current spending. Officials indicated that a substantial portion of available resources is likely to go towards salaries, pensions and other recurring obligations. Among the proposals under review are a 20 per cent increase in the minimum wage, a 10 per cent rise in salaries for government employees and an eight per cent increase in pensions, though these measures still require cabinet approval.

Development spending set to fall

Budget estimates show non-development expenditure at Rs2.56 trillion. At the same time, the upcoming fiscal plan is not expected to include major new development schemes. Instead, the government is expected to continue work on 3,642 ongoing provincial and district-level projects, for which Rs400 billion has been proposed.

Overall development expenditure is projected to drop from Rs1.018 trillion to about Rs720 billion, a reduction of nearly Rs300 billion compared to the current fiscal year. Provincial development allocations are expected to decline from Rs520 billion to Rs385 billion, while district development funding may be cut to Rs15 billion from Rs55 billion.

Despite the reduction in development outlays, officials said water resources, climate resilience, public health and education would remain priority areas. The budget framework also includes expectations of Rs64 billion in federal development grants and around Rs256 billion in external financing from international financial institutions.

Cabinet review and assembly debate

Before the budget is tabled in the assembly, a special cabinet meeting at 11am is set to examine and approve the proposals. The meeting will also take up supplementary expenditures for the outgoing fiscal year, review progress on the Annual Development Programme, and ratify earlier decisions as well as finance committee recommendations.

After the budget speech, the chief minister is scheduled to hold a post-budget press conference on June 18, where he is expected to explain the main features of the financial plan and highlight the government’s performance. A five-day general debate is also due to follow in the Sindh Assembly, with both treasury and opposition members set to take part.