• Budget likely on Friday subsequent to president summons NA, Senate sessions today • National Economic Council finally set to meet today; KP still weighing participation • Federal, provincial govts to jointly cover Rs800bn shortfall • Extra FBR revenue to stay with Centre; ‘ strategic needs ’ may require Rs1.3-1.7tr • Sindh, Punjab agree to cut ADPs; KP, Balochistan not yet on board • Uplift plans worth Rs4.715tr likely to be revised down ISLAMABAD: Signs that the federal budget may be presented later this week emerged on Tuesday after the government finally called a meeting of the National Economic Council ( NEC) on the same day that sessions of the National Assembly and Senate were summoned by President Asif Ali Zardari. A source in the NA Secretariat notified Dawn that both sessions have been called budget sessions for 2026 – 27; even so, it is expected that the budget will be presented in parliament on June 12. Sources close to the matter say additional details are expected to emerge soon.

Context and History

The current development is the latest chapter in a longer and complex story.

This echoed Parliamentary Affairs Minister Tariq Fazal Chaudhry ’ s words, who said on Tuesday that the budget for the next fiscal year would likely be presented in parliament on Friday.

The NEC, meanwhile, is set to meet today ( Wednesday) to finalise federal and provincial development plans in the wake of a broader agreement on cutting development and other expenditures at all tiers of the federation to cover around Rs800 billion revenue shortfall this year and jointly create similar, but higher, fiscal space next year for additional “ strategic needs ”.

Compounding the significance of these events, under the agreement reached between the PPP and PML-N, provincial shares from the federal divisible pool would stay frozen at the current fiscal year ’ s position.

Reactions and Responses

Industry leaders, officials, and analysts have offered a range of perspectives.

Any increase in FBR revenue next year on top of the contemporary year ’ s collection would be retained by the Centre, informed sources said.

Notably, to avoid permanence and legal precedent, an ad hoc mechanism would be put in place under which the Centre would transfer complete provincial shares to provincial accounts and the provincial governments would then credit the extra amount — higher than what they received this year — back to the Centre.

In a related development, to ensure that these additional amounts remain protected in favour of the Centre, both Sindh and Punjab would drastically cut their planned annual development plans ( ADPs) for next year and reduce other expenditures.

Policy Implications

For many, the real significance lies not just in what happened — but in what comes next.

This adjustment, they said, could provide close to Rs1tr in additional fiscal cushion to the Centre next year.

Adding to the complexity of the situation, he said next year ’ s additional fiscal requirement would be flexible, ranging between Rs1.2tr and Rs1.5tr or so.

Adding further dimension to the story, declining to share details, he said it would be done within existing resources and without additional taxes.

Notably, in return, informed sources said, the PPP reportedly secured an increase in federal funding for the Sukkur-Hyderabad Motorway ( M6) from Rs20bn cleared by the Annual Plan Coordination Committee to regarding Rs70bn, along with commitments for its actual utilisation and accelerated progress amid the coming fiscal year, not just an allocation on paper.

Meanwhile, sources familiar with the matter indicate that the sources indicated the federal finance ministry had earlier indica

The Road Ahead

This story will continue to develop. Observers, policymakers, and citizens will all be watching what happens next in a situation that has already proven to be significant in multiple respects.