Pakistan Boosts Defence Spending By 20% Amid Record Debt And Economic Woes
The PKR 2.55 trillion defense allocation is the largest budget outlay after interest payments, which account for a massive PKR 8207 billion.
Pakistan is set to boost its defence spending by nearly 20% in its annual budget for fiscal year 2025-26, allocating PKR 2550 billion for its military. This significant increase, the highest in recent years, comes as the nation grapples with its highest-ever public debt, potentially raising concerns about the utilization of international aid.
Defence Budget Surges Amid Record Debt
The PKR 2550 billion defense allocation is the largest budget outlay after interest payments, which account for a massive PKR 8207 billion. This substantial rise in military spending follows Operation Sindoor- a significant military response undertaken by India targeting terrorist infrastructure in Pakistan and Pakistan-occupied Jammu and Kashmir following Pahalgam attack- and comes even as Pakistan's overall debt burden reached unprecedented levels. According to Pakistan's Economic Survey, the total Public Debt of Pakistan, ending March 2025, hit PKR 76007 billion- its highest-ever mark. This figure has doubled in the last four years and increased fivefold over the past decade. India could cite this significant defense increase to question if International Monetary Fund (IMF) aid to Pakistan is being used to arm itself against India.
Pakistan's Economic Survey Paints Grim Picture
Pakistan's Economic Survey highlighted a concerning situation in Pakistan's agriculture sector, which is currently in dire straits. Growth in this vital sector plummeted from 6.4% to just 0.56% in the previous financial year. The outlook for the current year could worsen further due to anticipated water shortages in the Indus Water basin.
The interview, which initially touched on Pakistan's recent removal from the Financial Action Task Force (FATF) grey list, took a sharp turn when the conversation shifted to the country's historical record on terrorism and alleged complicity in harboring extremist elements.
Responding to questions about Pakistan's past, Sherry Rehman said, 'You keep on talking about the past… because it was." She added, 'We are fighting terrorism… Pakistan is a changed country now."
When pressed further on Pakistan's past tolerance of terrorism, specifically highlighting that Sajid Mir, a key plotter of the 26/11 Mumbai attacks, was only arrested after years of official denial about his presence in the country, Sherry Rehman said, 'You're citing a long history of engaging with terrorism one way or the other… either fighting it or otherwise."
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Hans India
10 minutes ago
- Hans India
Rajasthan sarpanches express gratitude to PM Modi for their I-Day experience at Red Fort
Sarpanches from the border areas of Barmer, Jaisalmer, Bikaner and Ganganagar were invited to the Red Fort in the national capital on the occasion of Independence Day on August 15 (Friday). Those present at the Red Fort on Friday shared their experience on Sunday. The sarpanches said they never thought that they would be called to Delhi and felicitated. They also thanked Prime Minister Narendra Modi and the BSF. The Border Security Force (BSF) carried out innovative initiatives on the occasion of Independence Day celebrations. Under this, along with BSF jawans at the border, the young public representatives who were always ready to serve the country were always invited as special guests. They got the opportunity to participate as special guests at the Red Fort. The aim of this initiative is to honour the public representatives. BSF IG Madanlal Garg said that the government had launched a vibrant village scheme, under which the village should be strengthened and the people of the village get employment in the village itself, and they should not go elsewhere. According to a statement, more than 220 schemes of Prime Minister Narendra Modi-led government are being 100 per cent implemented in Vibrant Villages. Vibrant Village Programme is proving to be a milestone in addressing the problem of migration from border villages. Sarpanch Bhartharam of Navatla Bakhasar village in Barmer district, sarpanch of Kanwarpura in Sri Ganganagar district, Sanjana, sarpanch of 22 KYD in Bikaner district, and Geet Kanwar, Sarpanch of Myajlar in Jaisalmer district, had received special invitations. BSF IG Madanlal Garg told the media that during Operation Sindoor, it was our responsibility to protect the people living in the border area. These people were also associated with us during this time. Their ability to stay at the border is unique. He said that the village residents "supported us during Operation Sindoor... there was no need to evacuate the village". One sarpanch each from villages in four districts of the border was selected to be called to Delhi. Sarpanches were called under the Centre's Vibrant Village Scheme. The Vibrant Village Scheme aims to develop the villages across the border areas. Through skill development, scope for new employment opportunities is aimed to be created so that the people of the village do not need to go to urban areas in search of employment. Sanjana, 22 KYD Sarpanch, Bikaner district, said: 'We were called to honour on the occasion of Independence Day. It was a great idea to meet PM Modi. Travelled in his life for the first time in an airplane." Bhartharam, Sarpanch of Navatla Bakhasar village in Barmer district, told IANS that it was a great experience. "During Operation Sindoor, we encouraged the BSF, so we were called to Delhi on Independence Day. It is a matter of great pride for all of us. We never thought we would get a chance to travel." Sarpanch Geeta Kanwar said: "I feel proud that on August 15, PM Modi extended an invitation. The BSF made quite good arrangements to take us to Delhi. It was good to listen to the Prime Minister's speech at the Red Fort. I thank PM Modi for inviting us."
Hans India
an hour ago
- Hans India
Ageing population, high debt seen as drags on China's growth ahead
China is expected to face an adverse economic impact in the coming decades due to its ageing population and high government debt, according to reports. High government debt raises interest costs and leaves less fiscal room to respond to shocks, just as ageing populations push up pension and health outlays, according to a report in Newsweek. The Chinese and US governments are among the most indebted in the world. The US government's gross debt at 123 per cent is equal to the country's GDP, according to International Monetary Fund data. China's stands at 84 per cent, buoyed by debt-driven growth in the 2010s and a housing market crunch that has heavily indebted local governments. London-based global advisory firm Oxford Economics estimates the Chinese economy's potential growth could be cut roughly in half by the 2050s. According to the Newsweek report: "Soaring pension and healthcare expenses are the biggest policy challenge of the 2020s in all advanced economies and most emerging ones." As per a United Nations report, China currently has a median age of around 40, which is well above the global average, and is projected to reach 52 by 2050. This would be much higher than even the US median age, which is expected to stay around 41 years. China's old-age dependency ratio, or the share of people aged 65 and older, is projected to rise by more than 50 percentage points by 2026 compared to 2010, versus roughly 8-10 points in the United States. This will strain China's modest safety net. And unless the country is able to reverse its flagging birth rate, this will shift the burden onto a smaller pool of workers, according to the report in Newsweek. Jed Cartledge, an economist and one of the authors of the Oxford Economics report, said this better positions the US demographically. China's fertility rate of 1.2 births expected per woman is among the world's lowest. While higher, the US rate of 1.6 births remains well below the rate of 2.1 necessary to sustain a population naturally. Cartledge pointed out, however, that historically, immigration has largely offset declining births and averted demographic problems in the U.S. "Admittedly, US immigration is taking a hit under the second Trump presidency, but we're expecting the reduction in net immigration to only last through the remainder of his second term before reverting to a 1.1 million per annum, which was the typical pace prior to the pandemic," Cartledge told Newsweek.
Hindustan Times
2 hours ago
- Hindustan Times
Atmanirbhar Bharat: Turning crisis into opportunities for growth, security
On Independence Day, from the ramparts of Red Fort, Prime Minister Narendra Modi painted a bold vision for India's progress, declaring Atmanirbhar Bharat the foundation of a Viksit Bharat — a developed India built on the twin pillars of self-reliance and strong defence. His message was clear: India's path forward lies in turning challenges into opportunities and securing its place as a global leader. Prime Minister Narendra Modi during his speech at the 79th Independence Day celebration at the Red Fort, in New Delhi on Friday. (ANI) During COVID-19, Atmanirbhar Bharat had transformed crisis into opportunity, which led to a surge in economic growth. The Trump tariff threat, too, is bound to turn a crisis into opportunity for greater self-reliance and strength to counter any impending calamity. The 'Sudarshan Chakra' Initiative The ' Sudarshan Chakra', an overarching security architecture, will neutralize any threat and improve India's offensive capabilities. Self-reliance will turn India into a major production hub that will capture world markets. The US tariff threats stem from perceived trade imbalance, India's continued oil purchases from Russia despite US sanctions and frustrations over stalled negotiations. Such tariffs could disrupt India's export-driven growth, affecting sectors like automobiles, IT services, textiles and pharmaceuticals. Managing US tariff pressures with diplomacy The Modi government is ably and patiently navigating the tariff threat through dialogue and diplomacy, and has 'India First' in every policy formulation and strategy. India, today, is one of the fastest-growing economies of the world and, in the words of the IMF, the 'only bright spot in the otherwise dark horizon'. Despite constraints, our monetary and fiscal space has enabled accelerated growth and our external accounts are comfortable. Infrastructure and digital progress Hence, an over 7% sustainable growth rate can be made our baseline, given the robust foundations we have created. We are a $4.187 trillion economy, relentlessly pursuing the vision to be a $ 30-35 trillion economy by 2047. One of our major achievements has been to lift over 250 million people above the poverty line and, at the same time, to have digitized the economy in a big way. From 14 km of road space per day in 2014, we are now at over 34 km per day, which reflects our prowess in infrastructural development. And we have been the 'Vishwamitra' – the pharmacy of the world during Covid 19- which supplied medical equipment, pharma products and vaccines to several countries. This proves our capability and unstinted ability and resolve to weather any storm. The tariff threat, in fact, will give India the opportunity to nudge towards emerging markets in Asia, Africa and Latin America. Africa offers vast opportunities in infrastructure, agriculture and energy collaboration. Our Act East Policy will help in increasing exports in apparels and electronics. ASEAN nations provide dynamic consumer markets for Indian textiles, pharmaceuticals and machinery. The UK, EU and Australia are new avenues where India is already engaged in talks and we now have an FTA with the UK. By pursuing South-South cooperation, India can position itself as a global supplier beyond the West. Promoting Indian brands, semiconductor manufacturing Indian brands need to be promoted on global marketplaces like Amazon and indigenous platforms should be built to broaden market outreach. The first 'Made in India' chips will be in the market by the year-end. The country is now in mission mode with six semiconductor units in the pipeline and four new ones already approved. Our 'Make in India' punch has already taken off in renewable energy with the 500 GW of clean green energy drive by 2030 and thrust on indigenous defense production, as announced on the 15th of August by the Prime Minister. Initiatives like the International Solar Alliance and Global Bio-fuel Alliance will position India as a leader in renewable energy, potentially opening up the doors to tariff-exempt trade deals. India spends about 0.7% of its GDP in research and development compared to 2 to 3% in advanced nations. This is now increasing. The Startup India Mission with over 1.6 lakh startups needs to be scaled up. The National Quantum Mission, with a $1 billion outlay, will develop indigenous capabilities and reduce import reliance. India is already a global IT services powerhouse and diversification of exports by expanding cloud services, cybersecurity, artificial intelligence, biotechnology, quantum computing and fintech will help as these are sectors where tariffs are less likely to apply. By strengthening the intellectual property regime, India will be able to negotiate better terms in trade talks. By becoming a preferred alternative manufacturing hub, India can both absorb supply chains and build resilience against US tariffs. Building supply chain resilience Supply chain diversification is imperative to stymie Trump's policies and India must enhance its Production-Linked Incentive Scheme to lure global firms. Accelerating domestic production is most essential. Investments in infrastructure and reducing logistics costs can make our exports cost-competitive globally. India's logistics costs nearly 14% of the GDP as compared to 8 to 9% in developed countries. So we need to invest in faster cargo and port clearance and efficient warehousing and supply chains. Next-gen GST and tax reforms The Modi government has announced the 'Next Generation GST reforms' which would substantially reduce the tax burden across the country. The GST Council will also consider proposals for further ease of compliance using technology and faster refunds to exporters. Moving to a two-rate GST structure will catapult India at par with advanced economies. Compliances for MSMEs, which form the backbone of India's exports, are also being simplified and will strengthen the nation's manufacturing capabilities and make us more self-reliant. Easing regulations would attract companies relocating from China. Tourism, being tariff proof, must be propelled and, considering India's several beautiful locations, this is the right time. Other structural reforms, eliminating redtapism and enforcing strategic disinvestment and asset monetization to execute the Modi government's policy of 'Minimum government Maximum Governance' will help the endeavor for free enterprise. As mentioned above, India today is one of the world's fastest growing economies with a 6.3% growth and pacing to be a $5.5 trillion economy by 2028. There has been a great leap in economic reforms, healthcare, ease of doing business, infrastructural growth, enforcing a tech-driven digital India, serving the poor with several schemes and with the largest food security programme in the world and Nari Shakti. 80% of stand up India loans and 68% of Mudra loans have gone to women entrepreneurs. We are aiming at one nation, one tax and one market; we are a global e-payment leader and economic growth engine and have ensured a faceless tax system for a more accountable economy. India today is a new India — strong, secure and invincible, as ably proved after we have pulverized Pakistan. All this is due to our policy of 'Sabka saath, sabka vikas, sabka vishwas and sabka prayas. And it is this 'Nation First' commitment of a determined government, which is dedicated to the welfare of its countrymen, which will make us succeed- always and every time. The author is a former chairman, Haryana Public Service Commission and chairman, Haryana Electricity Regulatory Commission. Views expressed are personal
