Overview

• Pakistan's coalition government, led by the PML-N and PPP, has agreed to an 18% rise in defence spending, raising the allocation to over Rs 2.5 trillion for the fiscal year 2025-26.
• The decision follows heightened tensions with India after the April 22 terror attack in Pahalgam, Jammu and Kashmir, which killed 26 people.
• India responded to the attack by suspending the Indus Waters Treaty, closing the Attari border crossing, and downgrading diplomatic ties, prompting reciprocal measures from Pakistan, including airspace closure and trade suspension.
• Pakistan has conducted missile training launches of the Fatah series (120 km range) and Abdali system (450 km range) as part of strategic signaling during the ongoing diplomatic standoff.
• Defence spending remains Pakistan's second-largest budgetary expense after debt servicing, reflecting the government's prioritization of security amidst fiscal constraints.