A Sick Nation, Empty Classrooms, and a Satisfied Budget!
What Pakistan’s health and education budget says about the priorities of a nation
Written By: Dr Daood
Budgets are more than just accounting documents. They are moral and political statements that reveal what a nation holds most dear. Governments make choices about where to spend every rupee of money. Once again, Pakistan’s Federal Budget 2026-27 raises an uncomfortable question: Are we spending enough on the health and education of our people to guarantee a prosperous future?
Pakistan ranks among the world’s youngest populations. Nearly two-thirds of the population is under thirty. Such a demographic structure can be a tremendous economic asset, but only if the young are educated, skilled, healthy and productive. Otherwise it risks becoming a demographic liability of unemployment, social tensions and economic stagnation.
Pakistan has historically invested significantly less in health and education than most of its peers. Total public expenditure on education is still around 2 per cent of GDP. Public health expenditure is around 1 per cent of GDP. These figures are among the lowest in South Asia and far below international recommendations.
The difference to neighbouring countries is striking.
India, with its own problems, spends much more on education and health. The Indian Union Budget 2025-26 allocated approximately INR 1.28 trillion for education and about INR 0.99 trillion for health and family welfare. More importantly, Indian states are major players in these sectors leading to much higher combined spending: India’s expenditure on education is estimated to be 4–4.5 percent of GDP and health expenditure is steadily rising over the last decade.
A more telling comparison is Bangladesh. Bangladesh, long considered to be economically weaker than Pakistan, has consistently invested in primary healthcare, maternal health, immunisation, female education, and social development. Now the country has better indicators in several areas of public health, such as life expectancy, infant and maternal mortality. Its progress shows how sustained investment in human capital can change national outcomes, even in the context of resource-poor environments.
Perhaps the most surprising comparison is with the United States.
Just look at Harvard University. It has an annual operating budget of over US$6 billion and an endowment of more than US$50 billion. Stanford University has a budget of about US$9 billion per year. The system has an annual budget well in excess of US$50 billion.
The comparison is startling when you convert it into Pakistani Rupees. One elite American university system can command resources that are near or above the combined annual budgets allocated to major sectors of Pakistan’s federal government. The comparison isn't perfect because universities and governments do different things, but it gives you a sense of how seriously advanced economies take knowledge creation, research, innovation and human development.
The message is crystal clear. And more and more of modern wealth is created by educated minds, not by natural resources. Continuous investments in universities, research institutions, and health care systems have produced Silicon Valley, biotechnology, artificial intelligence, pharmaceuticals, advanced manufacturing, and digital services.
Pakistan’s problem is not just lack of money. It is the distribution of the resources that are available. A huge portion of the public expenditure is spent on debt servicing. Before even considering development priorities much of government spending is taken up. “Education and health get the scraps, not the meat.”
The effects are visible everywhere. There are millions of children out of school. Learning outcomes are weak. Universities have a problem with research funding. The public hospitals are short of equipment and medicines and trained personnel. Brain drain continues as skilled professionals move abroad for better opportunities.
It’s a vicious cycle. Poor education cripples productivity. Weak productivity drags on economic growth. Growth is slow, limiting government revenues. Limited revenues constrain future investment in health and education.
Successful nations do the opposite.” They are creating a virtuous cycle by investing heavily in human capital. Good education results in skilled workers. “Skilled workers are the engine of productivity and innovation. Economic growth generates more revenue. More revenues equal more investment in health and education.
The real question for Pakistan is not whether it can afford more spending on health and education . The question is whether it can afford to.
All the rich countries of the world got rich by investing in their people over the long term. South Korea, Singapore, Finland, Ireland, and increasingly Bangladesh teach the same lesson. This is no social cost but the highest economic investment a country can make: human capital.
While Pakistan debates fiscal deficits, taxation and debt burdens, policymakers need to remember a simple truth: roads, buildings and infrastructure are important, but a nation’s greatest asset walks into classrooms every morning and enters hospitals every day.
A budget shows priorities. If Pakistan truly wants economic change, then health and education must shift from the margins of public spending to the centre of national strategy.
The future will not be decided by how much money Pakistan spends. It will depend on how Pakistan decides to spend.
ALT Pakistan Health & Education Budget 2026-2027