Islamabad, June 12: Pakistan on Tuesday announced a 17% hike in defence spending amid rising military tensions with India, even as it slashed overall government expenditure to address a worsening economic crisis.
The government allocated 2.12 trillion Pakistani rupees ($7.6 billion) for defence in the fiscal year beginning July 1, up from 1.82 trillion rupees last year. The announcement comes just weeks after deadly cross-border skirmishes with India in Kashmir, the worst fighting between the nuclear-armed rivals in years.
“This allocation reflects the current regional security environment,” Finance Minister Muhammad Aurangzeb told parliament during his budget presentation.
The increased defence outlay comes at a time when Pakistan is battling low growth, high inflation and a rising debt burden. The government has cut spending in several civilian sectors in a bid to meet fiscal targets set under its agreement with the International Monetary Fund (IMF).
Despite a ceasefire agreed in May, Islamabad remains wary of further escalations with New Delhi. Military officials on both sides have accused each other of provocations in recent weeks. The military, which has historically wielded significant influence over Pakistan’s foreign and domestic policy, remains a top budgetary priority. Defence takes up the largest share of current expenditure after debt servicing.
Critics warn that the increased defence budget may further squeeze development spending and social welfare schemes at a time when millions face food insecurity and unemployment. The finance minister said the government remains committed to economic reform and restoring macroeconomic stability, adding that talks for a new long-term IMF programme are underway.
