KARACHI: The Sindh government’s budget for fiscal year 2026-27 continues to prioritize renewable and alternative energy initiatives, even as the province operates within a tightened fiscal space and a reduced development outlay.
According to the budget speech delivered by Chief Minister Murad Ali Shah, the Annual Development Programme (ADP) has been scaled down to Rs720.385 billion from Rs1,018 billion in the previous fiscal year. Despite this contraction, the government has maintained a clear focus on sustainability and climate-responsive development.
A key highlight of the budget is the expansion of solar energy access under special initiatives. The ADP allocates Rs1.78 billion for off-grid Solar Home Systems and Rs1.89 billion for on-grid solar schemes aimed at low-income households, bringing total solar-related investment to Rs3.67 billion. These projects are designed to enhance electricity access in rural and underserved communities while reducing dependence on conventional energy sources.
Officials said the initiatives align with the province’s broader “Green Energy Initiatives” and ongoing climate-responsive budgeting framework. In the previous fiscal year, climate-tagged spending reached approximately Rs140 billion, and the development portfolio will continue to be aligned with environmental impact tracking in the new budget cycle.
The budget also highlights alternative energy development through the Sindh Enterprise Development Fund (SEDF), which is supporting projects such as a biomethane initiative in Gadap Town, Karachi. The waste-to-energy project is expected to generate up to 5 megawatts of electricity from organic waste, showcasing a circular economy model for urban energy solutions.
In addition, planning continues for green energy parks integrating renewable generation, battery storage, and digital infrastructure, alongside initiatives promoting electric vehicle charging infrastructure and potential carbon credit generation mechanisms.
While renewable energy remains a priority, the budget also includes allocations for conventional energy-linked infrastructure. The largest allocation of Rs10 billion has been earmarked for the Thar Coal Rail Connectivity project, including logistics links to Port Qasim, aimed at improving fuel supply chains for power generation. A further Rs600 million has been allocated for improvements in the Farash Complex irrigation network to support the Thar coal transport corridor.
The government also announced rationalisation of the Infrastructure Development Cess, reducing the target from Rs200 billion to Rs140 billion, with the aim of improving industrial competitiveness and easing pressure on energy-intensive sectors.
Total current revenue expenditure related to energy and allied sectors has been projected at Rs868.356 billion for FY 2026-27, reflecting the province’s continued investment in both conventional and renewable energy infrastructure despite fiscal constraints.
