Climate, disaster-related spending under PSDP: Budget documents lack clarity

ISLAMABAD: Amid the government’s repeated claims of prioritising climate resilience and disaster preparedness, the budget 2025-26 documents lack clarity over how climate and disaster-related spending is structured, measured, and reflected in the federal Public Sector Development Programme (PSDP).

A key table from the budget in brief 2025-26, “Gender, Climate and Disaster” outlines allocations across gender-focused initiatives, climate adaptation and mitigation, and disaster-related expenditures. However, the framework lacks clear linkages with PSDP projects, raising concerns over how these numbers have been compiled and how progress will be tracked.

The green component in subsidies is provided in a table allocating a total of Rs 587.3 billion as per the following sectors: energy allocated Rs529 billion, food 20 Rs billion, industries Rs 9 billion, transport, Rs 7.3 billion and agriculture Rs 22 billion. Business Recorder approached the spokesperson of Finance Ministry for clarity about the budget document, however, till filing of this report no response was received.

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While the government has allocated Rs 978 billion under climate and disaster categories, the missing link between these numbers and actual PSDP projects raises serious questions as the government provides no explanation of how these figures are derived or where they sit in the PSDP.

According to the document, climate mitigation sees the most dramatic jump, rising from Rs 212.8 billion in fiscal year 2024–25 to an unprecedented Rs 603 billion in fiscal year 2025–26. Climate adaptation is also allocated a sizeable Rs 85.4 billion, while supporting areas amount to Rs 28.3 billion.

However, the budget documents fail to identify which specific PSDP projects constitute these figures. There is no annexure, functional code, or cross-reference showing whether these allocations fall under the Ministry of Climate Change, Water Resources, Energy, Planning Division, or other sectors.

The document provides no methodology for assessing what qualifies as adaptation and mitigation.

This lack of standardization makes it difficult to determine how the government classified a project as adaptation or mitigation, whether international benchmarks were used and how duplication across ministries is avoided.

The absence of a measurable framework raises the risk of climate-washing, where normal infrastructure spending is rebranded as climate investment.

Under disaster, the budget allocation includes: preparedness - Rs 33.16 billion, response - Rs 15.87 billion and recovery & rehabilitation- Rs 1.14 billion. But again, these numbers do not appear to be linked to the National Disaster Management Authority’s (NDMA) PSDP projects, nor are they reflected in the Climate Change & Environmental Coordination Division.

The federal PSDP shows no clear markers or project codes that correspond to these allocations, making it unclear that which ministries are executing these funds.

The gender segment allocates funds to education quality, health and well-being, governance systems, economic empowerment, safety, and political participation. But these too do not correspond to identifiable PSDP projects.

Copyright Business Recorder, 2025