The government on Wednesday reduced the size of its Public Sector Development Programme (PSDP) by an additional Rs63 billion, bringing the total development budget down to Rs837.16 billion for the current fiscal year.

The latest cut was made by the Ministry of Finance as part of efforts to maintain fiscal stability amid ongoing regional tensions in the wake of the Iran war.

It marks the second downward revision of the development budget in recent months.

Earlier in March, the PSDP was reduced by Rs100 billion, bringing the total cumulative cuts to Rs163 billion from the originally allocated Rs1 trillion.

Sources said the latest reduction was implemented across multiple ministries and divisions, affecting development allocations in sectors, including water resources, education, health, railways, housing, information technology, and telecommunications.

Development funds for parliamentarians have reportedly been revised to Rs63.2 billion, while the Water Resources Division has been allocated Rs106.6 billion under the revised plan.

Allocations for other sectors have also been revised. Now, Rs34.9 billion have been allocated for the Higher Education Commission, Rs18.4 billion for the information technology sector, Rs18.5 billion for railways, and Rs11.6 billion for the Ministry of Health.

The merged districts have been allocated around Rs54 billion, while Azad Jammu and Kashmir and Gilgit-Baltistan have received over Rs67 billion in revised funding.

The defence division’s development budget has been revised to over Rs9 billion.

Officials said the decision to further trim the PSDP was taken in consultation with the Planning Division to support broader financial discipline amid continued economic pressure in the region.