Sindh Chief Minister Syed Murad Ali Shah presented the provincial budget estimates for the financial year 2025-26 in the Assembly at Rs. 3,451.87 billion with a deficit of Rs. 38,458 billion represents an increase of 12.9 percent compared to the previous year’s budget estimates of Rs. 3,056.3 billion for FY 2024-25.
The Minister of Ministry announced a 12 percent pay increase for class BS-1 employees to BS-16 and a 10 percent increase for those in grades BS-17 to BS-22 along with an increase of 8 percent in pensions.
“We are introducing a financial bill to abolish and reduce some taxes/taxes/cess instead of increasing them,” said the minister.
Key features at the Sindh budget
• 5 taxes: Professional tax, entertainment service, drainage cup, cotton fees and local cess abolished
• Reduction in taxes on motor vehicles, simplification of VAT through switching to a negative list system.
• Suggested 12 to 10% ad hoc exemption for state employees and 8% pension increase.
• Improved transport allowance for various activated employees and approval of outstanding pension fees.
• Rs. 146.9 billion earmarked as a subsidy for health units and institutions.
• Rs. 523.73 billion assigned to the education sector, an increase of 12.4% percent from the outgoing year
The budget emphasizes increased awards for education, health, infrastructure and social welfare together with strategic initiatives to modernize governance and stimulate economic growth.
Budget 2025-26
The provincial receipts for FY 2025-26 are projected to Rs. 3,411.5 billion, marking an increase of 11.6% compared to the current year.
Federal divisible pool transfers, which make up 75 percent of total revenue, are estimated at Rs. 1,927.3 billion, a 10.2 percent increase despite a 5.5 percent loss in the current year’s revised estimates.
Additional federal transfers, including equal transfers and supplements to offset losses from the abolition of OZT, are also intended to rise, bringing the total federal transfers to Rs. 2,095.6 billion.
Current revenue expenses (CRE) set to Rs. 2,149.4 billion, reflecting an increase of 12.4 percent from Rs. 1,912.36 billion in FY 2024-25.
This increase is due to inflation pressure, increased subsidies for non-financial institutions such as hospitals and universities, wage exemptions for government employees and higher pension payments.
Expenses and sectoral locations
Total spending is expected to increase by 12.9 percent to Rs. 3,450 billion. The current revenue expenses will grow by 12.4 percent to Rs. 2,150 billion, driven by wage and pension increases (6%), subsidies to local bodies (3%) and significant increases in key sectors:
• Police department: Rs. 189.75 billion (15.7% increase)
• Health sector: Rs. 336.46 billion (11.3% increase)
• -ducation Sector: Rs. 518.05 billion (18% increase)
In addition, Rs. 20 billion is awarded to “pro-poor social protection and economic sustainability initiatives”, which highlights the government’s focus on inclusive growth. To improve transparency and efficiency, educational -related funds are paid directly to schools.
Grants-in-Aid Total Rs. 702 billion has been awarded to various governments and non-financial institutions based on Directives from Chief Minister’s Secretariat and Finance Department.
Education sector
The education sector has received an award of Rs. 523.73 billion, which is an increase of 12.4 percent from Rs. 458.2 billion last year representing 25.3 percent of the total CRE.
Significant increases are observed across all levels: The budget for basic education has increased from Rs. 136.2 billion to Rs. 156.2 billion, while the secondary education budget has risen from Rs. 68.5 billion to Rs. 77.2 billion.
New initiatives include hiring 4,400 employees, establishing four IBA communities and empowerment of over 34,100 primary schools with dedicated cost centers and budgets. Rs. 2 billion is assigned to SINDH EDUCATION ENDOWMENT FEAD to support deserving and underprivileged students.
The various Abled Person Development Program (DEPD) budget has increased from Rs. 11.6 billion to Rs. 17.3 billion that provides improved support for aids, scholarships and partnerships with NGOs.
Health sector
The budget for health is set to Rs. 326.5 billion, representing an increase of eight percent from last year’s award of Rs. 302.2 billion.
Of this amount, Rs. 146.9 billion has been designated as a subsidy for help to health units and institutions.
The main assignments include Rs. 19 billion for the Sindh Institute of Urology & Transplantation (Siut), Rs. 16.5 billion for Peoples Primary Health Initiative (PPHI) and Rs. 10 billion for a new hospital in Larkana. In addition, there will be an extension of ambulance services and mobile diagnostic devices to improve access to rural healthcare.
The development portfolio and the annual development program (ADP) have been rationalized for Rs. 520 billion after a 20 percent reduction due to expected federal transfer deficit. The focus will be on 475 new schemes that prioritize flooding rehabilitation, renewable energy, development in underdeveloped districts, clean water and sanitary services.
Large sectoral locations include Rs. 99.6 billion for education, Rs. 45.37 billion for health, Rs. 73.9 billion for irrigation and Rs. 132 billion for local authorities.
Karachi development
Significant infrastructure upgrades are planned for Karachi, including road rehabilitation and improvements in sewerage and water supply across multiple districts.
Urban Transport in Karachi will expand with the introduction of Pakistan’s first 50 electric buses with plans to add another 100 in August 2025.
Progress on the city’s bus Rapid Transit (BRT) projects includes the yellow line approaching the completion and the red line is over 50 percent complete.
Karachi Safe City:
The Karachi Safe City project is making progress in the implementation of AI-integrated CCTV systems and extended coverage. Greater projects are also being made with major projects such as Korangi Causeway Bridge and improvements to Shahrah-e-Bhutto.
New ADP initiatives will target the subject of inheritance, improve business areas and facilitate crucial road structures.
Digital governance
The launch of a centralized Key Publisher Indicator (KPI) monitoring of the dashboard will enable real -time project tracking. Blockchain-based land registration reform is aimed at simplifying real estate transactions and improving transparency. In addition, a digital birth registration system is aiming for 100 percent coverage by 2028, which integrates health and education data.
Agricultural reforms
The introduction of the Benazir Hari card will support over 200,000 farmers with subsidies and mechanization assistance. Climate-Smart Agriculture will be promoted through drip irrigation grants and public-private partnership-driven cluster breeding projects.
A feasibility study is currently underway for Sindh Cooperative Bank to provide interest -free loans to progressive farmers.
Social Welfare and Empowerment:
The decentralization of educational budgets will allow school teachers to operate on operational funds. Support for people with disabilities will expand, including increased scholarships and the establishment of new rehabilitation centers. Furthermore, youth development centers will be created across Sindh that delivers skills training, career counseling and digital literacy programs.
Tax and relief measures
The abolition of five taxes, including professional tax and entertainment, aims to relieve financial burdens. There will also be reductions in motor vehicle taxes and a simplification of VAT through a transition to a negative list system.
The minister has announced a 12 per cent. Ad hoc exemption for government employees in BPS-1 to BPS-16 and a 10 percent increase for those in BPS-17 to BPS-22 along with an eight percent increase in pensions.
An improved transport allowance for different activated employees will be introduced and all outstanding pension taxes will be cleared. Special grants for lawyers, journalists and minority groups will support welfare and development initiatives.
Murad Ali Shah emphasized the role of the budget in exploiting Sindh’s unused potential through inclusive, elastic and sustainable development.
He called for unity and collective efforts to guide the province and the nation of peace, progress and prosperity. This comprehensive budget reflects Sindh’s obligation to social uplifting, infrastructure modernization and economic empowerment that places the province in a transformative year to come.
