US Urges Pakistan to Enhance Transparency in Military Spending

The US State Department has urged Pakistan to bring military and intelligence budgets under civilian oversight, citing a lack of transparency in fiscal practices. The 2026 Fiscal Transparency Report highlights hidden state-owned enterprise debts and calls for a timely release of budget proposals for enhanced fiscal governance.

The US State Department has spotlighted significant transparency issues within Pakistan's defense expenditures, urging the country to subject its military and intelligence budgets to civilian and parliamentary oversight. This appeal comes as part of the 2026 Fiscal Transparency Report, which flags Pakistan's failure to sufficiently open its defense spending to public scrutiny and noted gaps in disclosing state-owned enterprise debt and executive budget timelines.

The report indicates that, while Pakistan has made its enacted budget and end-of-year financial statements available online, it has failed to offer the same transparency for military and intelligence expenditures. The State Department emphasizes the need for legislative checks to ensure fiscal governance, criticizing the lack of adequate public oversight and the failure to timely publish the executive budget proposal.

Additionally, concern was raised over the limited information on Pakistan's public debt obligations, particularly regarding hidden liabilities associated with state-owned enterprises. The report outlines three key corrective measures for Islamabad: timely public release of the executive budget proposal, comprehensive disclosure of government debt obligations, and enhanced oversight of military budgets. Despite these transparency issues, the report commended Pakistan's supreme audit institution for its independence and timely audit reports.