Sindh unveils Rs3.56tr budget with no new taxes, raises salaries and pensions by 7pc

Sindh Chief Minister Syed Murad Ali Shah on Wednesday presented a Rs3.562 trillion budget for the fiscal year 2026-27 in the Sindh Assembly, announcing that no new taxes would be imposed while unveiling a series of relief measures, development projects and economic initiatives.

Presenting the provincial budget, the chief minister announced a 7% increase in salaries and pensions of government employees and said ad hoc relief allowances granted in 2022 and 2025 would be merged into the basic pay structure. He also raised the minimum monthly wage from Rs40,000 to Rs43,000.

CM Murad said that Sindh had been compelled to reduce its development portfolio from Rs575 billion to Rs400 billion due to coordination with the federal government, while ensuring protection of the province's share under the National Finance Commission (NFC) Award.

The chief minister announced the establishment of the Sindh International Financial Centre (SIFC) in Karachi, describing it as a platform for infrastructure, Islamic and climate finance. He said the centre would help transform Karachi into a regional hub for investment, fintech and financial services.

He also unveiled plans to develop Keti Bandar into an international maritime, logistics, industrial and energy hub linked with Dhabeji Special Economic Zone and Thar's coal resources. He said the project would strengthen Pakistan's connectivity with global trade routes and serve as a new economic gateway for the country.

Highlighting the government's renewable energy agenda, the chief minister announced what he described as Pakistan's largest solar programme. Under the initiative, 275,000 free solar home systems would be distributed at a cost of Rs18 billion, while a subsidised solar financing programme would also be introduced for middle-income households.

The provincial government has allocated Rs13.2 billion for social protection programmes, including kitchen gardens, the Benazir Hari Card and the Benazir Women Agriculture Workers Programme. Assistance schemes for widows and orphans will also continue.

CM Murad announced tax relief measures, including a reduction in sales tax on educational support services to 5%, lower taxes on insurance agents and brokers, and a reduction in the agricultural super tax rate from 10% to 8%. The exemption threshold for agricultural super tax has also been increased from Rs150 million to Rs500 million.

The chief minister said the Annual Development Programme (ADP) for the next fiscal year had been set at Rs400 billion. Of this, Rs121.6 billion has been earmarked for local government and municipal infrastructure, Rs40.9 billion for public health engineering, Rs39.5 billion for transport and communications, Rs30.9 billion for irrigation, Rs25.9 billion for education and Rs17.4 billion for health.