The federal government has proposed allocating Rs. 70 billion for the Sustainable Development Goals (SDGs) Achievement Programme in the upcoming FY2026-27 Public Sector Development Programme (PSDP), even as fiscal pressures leave little room for fresh development spending.

The proposed allocation comes at a time when the government is facing mounting constraints in managing its development budget. Planning officials said ministries and divisions submitted development demands exceeding Rs. 4.1 trillion for FY2026-27, while the Finance Division set an indicative ceiling of just Rs. 1.126 trillion for the federal PSDP.

According to official documents, the SDGs Achievement Programme will make up around 6.2 percent of the proposed federal development budget for the next fiscal year. The allocation has been kept at the same level as the original FY2025-26 estimate of Rs. 70 billion, despite rising funding needs across several sectors.

The broader PSDP for FY2026-27 continues to prioritize infrastructure, which has been allocated nearly Rs. 729.9 billion, or 65 percent of the total federal development outlay. Within this, transport and communications projects have received the largest share at about Rs. 408.9 billion. Water projects are set to receive Rs. 140.4 billion, while energy schemes have been allocated Rs. 135.6 billion.

Officials have also raised concerns over the growing pressure on the federal development portfolio. The throw-forward liability of ongoing projects has crossed Rs. 10 trillion, while more than 90 percent of schemes are facing delays or cost overruns.

In view of these challenges, the government has indicated that new development projects will largely be discouraged in the next fiscal year. Instead, priority will be given to strategic ongoing schemes and foreign-funded projects to ensure better use of limited resources.