Pakistan’s defense budget hike between fiscal priorities debate amid cash crunch. Bharat News

Islamabad: Pakistan’s decision to protect the defense spending more than Rs 18% to Rs 2.5 lakh crore in the budget of 2025-26 has ignited the latest debate on cash-stapped country’s fiscal priorities as economic understanding and inflation is more than 38%.Economists warned the latest defense allocation as a reaction to increasing tension with India after the April 22 Pahgam attack, with 26, most tourists were killed, the risk of removing economic reforms and squeezing social expenses.Cross-border firing with LoC intensified in 2025. In response, Islamabad has vowed to increase military preparations by moving together with expensive hydropower projects.Planning and Development Minister Ahsan Iqbal recognized water security as a strategic imperative, India accused the rivers shared under the Indus Water Treaty of “water aggression” through upstream dam projects. Iqbal said, “We will not allow India to take advantage of our water resources,”It is expected to produce 4,500mw and produce 8.1mn acre-feet water, Diamer-Bhasha is still the year from completion, which is interrupted by intervals and logistic failures.Analysts questioned whether Islamabad could simultaneously maintain defense and infrastructure. Economist Dr. Kaiser Bengali called the approach as risky. He said, “Defense like Daimer-Bhash and removal of funds for megaproosters can weaken social expenses and economic reforms, which can brunt ordinary Pakistanis,” he said on Sunday.Pakistan’s debt-to-GDP ratio is 70%. In 2024, with a $ 25BN trade deficit and barely import cover for three months, the fiscal location remains tight. Facing a serious financial crunch with a $ 3BN hovering with foreign reserves, Islamabad is under pressure from the $ 7BN IMF Bellout program that demands strict fiscal controls.The government denied the pressure of the IMF, delayed in the federal budget, instead it was responsible for PM Shahbaz Sharif’s foreign trip and Eid holidays. Analysts are unrelated.Bengali said, “The monitoring of the IMF is unavoidable.” “This budget reflects a juggling work between security concerns and economic existence.”