Government Slashes PSDP by Rs. 250 Billion

Slashes PSDP

The federal government has decided to reduce the Public Sector Development Programme (PSDP) budget of Rs. 1.4 trillion for the fiscal year 2024-25 by Rs. 250 billion to create fiscal space for withdrawing certain taxes.

Planning Minister Ahsan Iqbal announced on Tuesday that this decision comes as part of the government’s efforts to adhere to stringent conditions set by the International Monetary Fund (IMF) in order to secure a new loan program.

Minister Iqbal stated that the budget cut is intended to protect the public from additional taxes. Following the reduction, the development budget for the upcoming fiscal year will now be Rs. 1.15 trillion.

On June 12, Finance Minister Muhammad Aurangzeb had proposed a record Rs. 1.4 trillion for development spending during FY25.