Published June 2, 2026 Updated about 3 hours ago By Naveed Butt ISLAMABAD: Federal Minister for Planning, Development and Special Initiatives Ahsan Iqbal has said that the Ministry of Finance has allocated Rs1.126 trillion for the Public Sector Development Programme (PSDP) 2026–27 against total development requirements of Rs4.097 trillion, resulting in a funding gap of nearly Rs3 trillion. The minister said that the government has set a 4 percent Gross Domestic Product (GDP) growth target for fiscal year 2026–27, up from an estimated 3.7 percent in the current fiscal year (2025–26). While addressing the Annual Plan Coordination Committee (APCC) meeting on Monday, the minister expressed serious concern, saying the government may be forced to shelve development projects worth nearly Rs3 trillion in the new financial year, after receiving project demands of around Rs4 trillion against a PSDP 2026–27 allocations of only Rs1.126 trillion. He said projects worth around Rs3 trillion would either be rejected or not approved. “We will have to selectively allocate only Rs1.126 trillion out of demands exceeding Rs4 trillion. This is a very unpleasant task,” Ahsan Iqbal said. He said the country’s development budget fell short of requirements, making the timely completion of projects increasingly difficult and posing a serious challenge to the planning process. “The PSDP allocation of Rs1.126 trillion includes Rs125 billion earmarked for the N-25 Highway project in Balochistan, which, he said, is a non-negotiable priority identified by the Prime Minister and will be completed at all costs,” he said. He added that around Rs87 billion had been set aside for projects proposed by coalition partners, while approximately Rs100 billion had been earmarked for development initiatives in Balochistan. The minister emphasized the need to prioritize and complete ongoing development projects, saying that limited fiscal space and a growing throw-forward had made it impossible to fund all schemes under the Public Sector Development Programme (PSDP) 2026–27. He said these funds should ideally be transferred through the National Finance Commission (NFC) mechanism, but in…