The Federal Budget 2025-26 outlines significant investments in infrastructure, housing, water resources, energy, and transportation projects aimed at supporting Pakistan’s long-term economic growth. According to budget documents, the government has allocated substantial funding for several strategic initiatives across the country.
One of the key allocations in the Federal Budget 2025-26 is Rs10 billion for Karachi’s K-IV bulk water supply project. The project is designed to improve water availability in the country’s largest city and address increasing demand caused by rapid urban expansion and population growth.
The government has also allocated Rs54.6 billion for sustainable urban development and the housing sector. Under this initiative, approximately 150,000 affordable housing units will be developed through federal and provincial programs. In addition, digital master plans will be prepared for 10 major cities to support modern urban planning and infrastructure management.
Major investments have been proposed for water and energy infrastructure projects. The budget earmarks Rs14 billion for the Diamer-Bhasha Dam, Rs22 billion for the Mohmand Dam, and Rs15 billion for the Dasu Hydropower Project. Furthermore, Rs116.2 billion has been allocated for the overall development of the power sector.
To strengthen industrial growth and enhance export competitiveness, the government has set aside Rs6.6 billion. Officials believe these investments will help improve productivity, encourage industrial expansion, and increase Pakistan’s presence in international markets.
The transportation sector is also expected to receive a major boost. The budget allocates Rs100 billion for upgrading the N-25 Highway, also known as the Pakistan Expressway, into a dual carriageway connecting Karachi with Chaman. Additionally, Rs30 billion will be invested in the Sukkur-Hyderabad Motorway project.
Pakistan’s railway infrastructure is another priority under the development plan. Budget documents indicate that work on the Karachi-Rohri section of the ML-1 railway project will begin during the next fiscal year, with an initial allocation of Rs25 billion. The government expects these large-scale development projects to improve connectivity, support economic activity, and contribute to sustainable national growth.
