KARACHI: The Sindh government has announced a 30 percent reduction in its development budget for the next fiscal year (FY27), with the cut to be absorbed across all development components.
Due to geopolitical tensions in the Gulf, rising economic uncertainty, fiscal constraints, and Sindh’s austerity measures, no new schemes will be included in ADP 2026-27 except carried-forward unapproved schemes from ADP 2025–26.
According to the budget estimates, the Sindh government has proposed the development expenditure amounted to Rs 720.385 billion for FY27, recording a sharp decline of 30 percent over this year’s (FY26) development portfolio of Rs1.018 trillion.
This year, ADP implementation was slowed by limited fund utilisation due to resource constraints and operational challenges. With 1,381 schemes fully funded and nearing completion, the total development budget for FY26 has been revised from Rs. 1.018 trillion to Rs 944 billion.
READ MORE: Sindh govt approves development projects
Budget Estimates for next fiscal year for Provincial Annual Development Programme (ADP) has been decreased to Rs 385 billion against last year’s budget of Rs 520 billion. Next year’s budget estimates for district ADP have been proposed to be Rs.15 billion for FY27 down from Rs 55 billion of FY26.
However, budget estimates for FY27 for Foreign Project Assistance (FPA) component also declined from Rs 366.7 billion to Rs. 256.055 billion for the next fiscal year. In addition, Rs. 64.33 billion has been proposed for the Federal PSDP for the next year’s budget down Rs 76.58 billion of this fiscal year.
The provincial ADP for this fiscal year was initially approved at Rs 520 billion, however due to adjustments in federal funding amid regional conflict, revised estimates have been set at Rs. 440 billion.
Priority was given to schemes nearing completion, key social sector interventions, and projects focused on rehabilitating flood-damaged infrastructure across the province.
In the current financial year, 1,066 schemes across various departments under ADP FY26 have been completed. Of the 473 new schemes introduced, approved projects will continue as ongoing schemes in ADP FY27.
The development budget in FY26 was allocated to align with government priorities and achieve targeted socio-economic outcomes. While 480 new schemes were added to ADP 2025-26, the main focus remained on completing existing projects, especially after the 2022 floods. Resources were directed toward rehabilitating community infrastructure such as roads, education and health facilities, housing, 36 water supply and sanitation, agriculture, livestock, and irrigation networks damaged by recurring floods.
Under the ADP 2026-27, sector-wise allocations have been outlined across key development areas, with the largest share of Rs. 121.663 billion (26.2 percent) earmarked for Local Government, including mega projects in water & sanitation and roads. The Education Sector has been allocated Rs. 25.860 billion (6.80 percent), while the Health Sector will receive Rs 17.433 billion (4.60 percent). Public Health Engineering and Rural Development have been allocated Rs. 40.86 billion (10.70 percent), followed by Transport & Communication at Rs. 39.536 billion (10.4 percent) and Irrigation at Rs. 30.94 billion (8.14 percent). The Agriculture sector, including livestock, has been allocated Rs. 6.30 billion, accounting for 1.66 percent of the total ADP size.
Chief Minister Syed Murad Ali Shah in his budget speech informed that the Sindh Development Portfolio Management System (SDPMS) is a transformative digital platform and dashboard developed by the Planning & Development Board of Sindh.
Copyright Business Recorder, 2026
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