New Delhi: When Pakistan’s finance minister Muhammad Aurangzeb presents the country’s FY26 federal budget on Tuesday, top officials sitting in New Delhi will scout for a key figure —defence spending —according to two persons privy to the situation.
New Delhi’s concern is about where the money is coming from – will international aid to Pakistan, given for specific, targeted projects actually go into the stated purpose of economic reforms and climate resilience or will it be diverted to the military?
As part of a $2.4 billion financial aid approved last month by the International Monetary Fund (IMF), Islamabad has committed to preparing its FY26 budget “in close consultation with the Fund”.
This condition, said one of the persons quoted above, is usually reserved for bail-out packages for far more serious financial crises, but has been applied in the case of Pakistan despite the funding being tailored for specific projects.
Coming against the backdrop of the recent India-Pakistan conflict, this enables greater multilateral oversight of the country’s resource management, the person said requesting anonymity.
IMF documents will show Pakistan’s commitments and trajectory for major revenue receipts and spending targets, including defence. “If we see any discrepancies, we can take it up with IMF,” said the second person, who also asked not to be named.
Defence spending
Information available from the IMF, based on Pakistani authorities and IMF staff estimates and projections, showed Islamabad’s defence spending is estimated to have risen from ₹1.2 trillion Pakistani rupees in FY20 to over ₹2.1 trillion in FY25 although as a share of GDP, it declined from 2.6% to 1.9% during the period.
Queries emailed on Thursday to the IMF and to the finance and external affairs ministries on Friday seeking comments for the story remained unanswered at the time of publishing.
Experts pointed to the need for close oversight of how Pakistan uses international aid.
“India has to work closely with the countries contributing to the resources of international and multilateral organizations to ensure that either funding is not extended to Pakist