The federal government has planned to provide interest-free loans to 86,000 individuals under the Pakistan Poverty Reduction Program as part of the Federal Budget 2026-27, according to official documents. The initiative is aimed at supporting low-income households by expanding access to financial assistance and creating new livelihood opportunities for vulnerable communities across the country.
Under the proposed plan, eligible beneficiaries will receive interest-free financing to help start or expand small businesses, improve household incomes, and promote economic self-sufficiency. Officials believe the program will play an important role in reducing poverty while encouraging entrepreneurship among underserved segments of society.
In addition to poverty reduction measures, the upcoming budget places significant emphasis on climate resilience and sustainable development. Around 80 projects focused on climate adaptation and strengthening infrastructure are expected to be completed during the next fiscal year. These initiatives are designed to help communities better cope with environmental challenges and the increasing impact of climate change.
Youth development is also a major focus of the proposed budget. The government plans to expand the Prime Minister’s Youth Skill Development Program, with a target of training 120,000 young people in IT and digital skills. The initiative aims to improve employability and prepare Pakistan’s workforce for opportunities in the rapidly growing global digital economy.
To support these efforts, the government has allocated Rs5.29 billion for IT and digital skills training programs. In addition, Rs300 million has been earmarked for the Prime Minister’s Empowered Youth Internship Program, which seeks to provide practical work experience and career opportunities for young graduates entering the job market.
The overall Federal Budget 2026-27 is expected to range between Rs17.5 trillion and Rs17.6 trillion, with a focus on fiscal consolidation, reforms linked to the International Monetary Fund (IMF), and targeted relief measures. Budget documents indicate an FBR revenue target of around Rs15.3 trillion, non-tax revenues of Rs2.77 trillion, and petroleum development levy collections of approximately Rs1.73 trillion. Major expenditures are expected to include Rs7.8 trillion for debt servicing, between Rs2.7 trillion and Rs3 trillion for defence, and around Rs1 trillion for the Public Sector Development Program. The budget is also expected to include a 10 percent increase in salaries and pensions while continuing efforts to broaden the national tax base.
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