Pakistan’s higher education sector has been facing serious financial challenges for several years due to diminishing government support, particularly in the development funds for Higher Education Institutions (HEIs). Public universities across the country are struggling to manage increasing operational expenditures, including salaries, pensions, utility bills, transportation fuel and other administrative expenses. At the same time universities are also required to allocate substantial resources for research activities, laboratory repair & maintenance and preservation of academic infrastructure and the provision of modern educational facilities for students. Without sufficient financial assistance in the upcoming budget especially, for public sector universities. It may become increasingly difficult to maintain quality education, sustain a conducive academic environment and continue research and innovation activities effectively.
Over the past decade, the allocation of funds to the Higher Education Commission (HEC) has witnessed significant fluctuations. Although the budgetary share of higher education increased in certain years, rising inflation and escalating operational costs have reduced the actual financial position of the universities. During the financial year 2016–17 the government allocated approximately Rs. 79 billion for the education sector and similar trends continued in subsequent years. However, in 2018–19 the higher education budget experienced a considerable reduction. The situation further worsened during and after the Covid-19 pandemic, when the country faced severe economic constraints. These financial difficulties adversely affected plans aimed at improving the quality of higher education and strengthening research activities in universities.
The another source of funding is the development funds allocated to public universities under the annual Public Sector Development Programme (PSDP) for improvement of quality education, have also been shrinking over the years. A few years ago, the government allocated more than Rs. 60 billion for ongoing and new development schemes to improve infrastructure and research facilities in universities. However, due to worsening economic conditions, these allocations gradually declined and in 2022–23 the government released minimal development funds for higher education institutions. This trend of reduced allocations continued in the following years as well. For the financial year 2025–26, the government allocated approximately Rs. 39.5 billion for development projects in public universities. Such reductions directly affect the pace of development projects, research initiatives and the adoption of advanced technologies and modern tools in different academic disciplines.
It is pertinent to mention that the Higher Education Commission serves as the backbone of Pakistan’s higher education sector and adequate funding is essential for the improvement of education, research and innovation in the country. The funds allocated under the PSDP are primarily utilized for the construction of academic infrastructure, smart classrooms, research laboratories and establishing the new buildings to facilitate students and researchers. These funds also support technology-based educational initiatives in universities. Development projects in the fields of agriculture, engineering, information technology, and scientific research are implemented through PSDP allocations to strengthen national progress and technological advancement. Similarly, provincial governments also provide funding to public universities through their Annual Development Programmes (ADPs) for higher education reforms and infrastructure development. However, with the increasing number of public universities and expenditures of HEIs the allocation of funds under both PSDP and ADPs needs to be enhanced accordingly.
For sustainable economic growth and a brighter future for Pakistan, it is imperative to invest substantial resources in higher education, research, technology and innovation. The government’s recent focus on digital learning, artificial intelligence, entrepreneurship, industry-academia collaboration and merit-based scholarships is a positive development. Likewise, reforms introduced by the Higher Education Commission and provincial education authorities to improve governance, research quality, international collaboration, and quality assurance can significantly strengthen the performance of public universities.
Despite these efforts, the financial share of the education sector in both federal and provincial budgets still requires considerable enhancement. Pakistan continues to spend less than 2 percent of its GDP on education, whereas many developed countries allocate between 4 to 6 percent of their GDP to the education sector. Increased investment in education will not only produce a skilled workforce equipped with modern knowledge and research capabilities but will also contribute significantly to economic growth and national development.
As the Government of Pakistan prepares the budget for the financial year 2026–27, there is a strong need to increase both recurring and development allocations for public universities and higher education institutions instead of continuing the previous trend of budget reductions. Enhanced funding will help universities address key challenges identified in the upcoming education policy reforms and improve the overall standard of higher education in the country.
The Higher Education Commission and provincial higher education departments are expected to emphasize the need for substantial increases in operational and development grants for public universities in FY 2026–27. Their major priorities include enhanced operational support, restoration of research funding, expansion of scholarship programmes, and increased PSDP and ADP allocations for ongoing and new development projects. The Government of Pakistan must prioritize public universities and research institutions as key drivers of national development, technological advancement, and socio-economic progress in the country.
The writer is affiliated with PMAS-Arid Agriculture University Rawalpindi and is serving as Assistant Registrar (Planning). The views expressed are solely his own and do not necessarily reflect the official position of his organization.
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