Pakistan Increases Defence Spending by 15% Amidst New Loan Negotiations

Pakistan's government, in its 2024-25 budget, announced a nearly 15% increase in defence spending, raising the allocation to Rs 2,122 billion. The budget aims for a 3.6% GDP growth, focusing on fiscal consolidation and development amidst ongoing efforts to secure a new IMF loan to address external liabilities.

Pakistan's government unveiled its 2024-25 budget on Wednesday, announcing a nearly 15% increase in defence spending, pushing the allocation to Rs 2,122 billion. This significant hike comes amidst the country's ongoing efforts to secure a fresh loan from the International Monetary Fund (IMF) to meet its external liabilities.

Finance Minister Muhammad Aurangzeb presented the budget in the National Assembly. This is the first budget from the coalition government of Pakistan Muslim League (Nawaz) (PML-N) and Pakistan Peoples Party (PPP) since their recent electoral win.

The budget, amounting to Rs 18,877 billion in total, sets a 3.6% GDP growth target for next year. The government also plans to privatize loss-making state entities while focusing on social sector development, IT promotion, and tax revenue enhancements.

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