Pakistan to Hike Defence Budget by 18% Amid Rising Tensions with India
Facing mounting tensions with India after the Pahalgam terror attack, Pakistan is set to increase its defence spending by 18% to over Rs 2.5 trillion in the 2025-26 federal budget.
Pakistan’s coalition government has agreed to significantly raise its defence outlay in the upcoming budget, even as the country grapples with a precarious economic situation. The decision follows a consensus between the ruling Pakistan Muslim League-Nawaz (PML-N) and its ally, the Pakistan People’s Party (PPP), amid growing regional security threats.
According to The Express Tribune, PPP leader Bilawal Bhutto Zardari met Prime Minister Shehbaz Sharif and senior members of his economic team on Monday to finalize the framework. Sources confirmed that both parties endorsed a defence hike from Rs 2,122 billion to over Rs 2.5 trillion — an 18% jump.
The increased military expenditure will remain Pakistan’s second-largest budgetary item after debt repayments. For the ongoing fiscal year, Rs 9,700 billion has been earmarked for debt servicing — the highest component in the federal budget.
The proposed Rs 17.5 trillion budget will reportedly be slightly lower than the current year’s total budget due to a sharp reduction in interest payments, attributed to the central bank’s 11% policy rate cut.
The move comes just weeks after the April 22 terror attack in Jammu and Kashmir’s Pahalgam, where 26 people were killed. India has since taken a series of strong retaliatory measures, including suspension of the Indus Waters Treaty, closure of the Attari border, and downgrading diplomatic ties with Islamabad.
In response, Pakistan shut its airspace to Indian flights and halted all trade — even via third countries — exacerbating already strained bilateral relations.
In a show of readiness, Pakistan on Monday successfully conducted a training launch of the Fatah-series surface-to-surface missile with a range of 120 km. Just days earlier, on May 3, the country tested the Abdali Weapon System with a 450-km range.
Defence analysts suggest the spike in military activity and budgetary allocation signals Islamabad’s strategy to bolster national security amid deteriorating relations with India.
