An analysis of Pakistan’s federal development budget for fiscal year 2026-27 reveals a significant structural bias toward large-scale physical infrastructure at the expense of digital and technology projects, raising questions about the credibility of the government’s stated ambitions to build a knowledge-based digital economy. The Ministry of Planning uses a classification framework called the Rockfill Strategy to prioritise its 786 active development projects, dividing them into three tiers: Rocks for projects costing over Rs7.5 billion, Pebbles for those between Rs1 billion and Rs7.5 billion, and Sand for projects costing under Rs1 billion. The data shows that 197 large-scale Rock projects are absorbing 81 percent of the total development backlog at Rs10,065 billion, while 254 projects classified as Sand, a category that includes most digital and technology initiatives, share just 4 percent of the funding at Rs84 billion combined.
The practical consequences of this classification system for Pakistan’s digital sector are stark. The IT Park Karachi requires Rs11.5 billion to complete its development but remains trapped in the lower funding tiers. The IT Park Islamabad needs Rs6.49 billion to move forward. The Digital Economy Enhancement Project carries a funding demand of Rs6.03 billion. The Islamabad Technopolis has been allocated a modest Rs1.54 billion, and the Prime Minister Laptop Scheme has been left with just Rs210 million. These are not fringe or experimental projects. They represent foundational digital infrastructure that the government has publicly committed to as part of its broader technology and export agenda, yet their funding position in the development budget tells a different story about where actual capital is being directed.
The contrast with physical infrastructure allocations is particularly striking. The N-25 Pakistan Expressway alone is set to receive Rs290 billion in the upcoming fiscal year, a figure that dwarfs the entire combined allocation for the Sand category covering all 254 smaller projects across all sectors. This pattern reflects a broader tendency within Pakistan’s development planning culture to treat tangible, large-scale construction projects as credible investments while categorising smaller, digital, and knowledge-economy projects as low-priority line items that can be deferred without consequence. The assumption embedded in this approach, that roads and dams generate returns while technology parks and digital platforms do not, sits increasingly at odds with global evidence about where the highest-value economic growth of the coming decade will originate.
The underfunding of digital infrastructure in the FY27 budget arrives at a moment when Pakistan is simultaneously making ambitious public statements about becoming a technology export powerhouse, reaching $5 billion in IT exports, digitising government services, and positioning itself as a destination for artificial intelligence and data economy investment. The gap between that rhetoric and the Rs84 billion allocated to the Sand category across 254 projects points to a structural misalignment in how development priorities are translated from policy statements into actual budget allocations. Without a deliberate rebalancing of the Rockfill framework to ensure digital infrastructure projects receive funding commensurate with their economic potential, Pakistan’s digital economy aspirations risk remaining aspirational well into the next decade.
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