Post-Budget 2026-27 reflections continue to show fiscal stabilisation, making slight strides towards institutional reforms in some sectors, with the integration of climate and disaster considerations into public financial management (PFM) systems through budget tagging and technology-enabled tracking.
We have progressed in measuring climate and disaster spending, yet we need to make adequate investments in resilience, anticipatory action and disaster risk reduction, with anticipatory financing as the next step. The target for future budgets should be to move from tracking climate risks and hazards to financing resilience through foresight and anticipatory action tools. This will help consolidate the reforms introduced in the budget by increasing investment in resilience, disaster risk management (DRM), and anticipatory action.
It is good that Pakistan has realised the need for and introduced some governance reforms for DRM allocations. However, by continuing in a reactive mode, the country risks missing the opportunity to adopt a more proactive approach to future budget allocations.
The Anticipatory Action (AA) system in Pakistan is largely forecast-driven and hazard-specific, whereas emerging risks are becoming increasingly systemic, compound, cascading, and uncertain. As a result, there appears to be a gap between ‘what we can forecast’ and ‘what we can foresee’.
As an anticipatory action and foresight professional, I propose that, to fill this gap, anticipatory action be embedded within strategic foresight, horizon scanning, and anticipatory governance approaches through an enhanced concept of ‘Anticipatory Action Plus (AA+)’ in future budgets. By integrating forecast-based early action with strategic foresight, anticipatory governance, and systemic risk intelligence, Pakistan can better address compound, cascading and long-horizon climate risks and disasters.
Existing anticipatory action helps societies act before a forecast disaster occurs, based on triggers. Anticipatory Action Plus (AA+) enables governments and communities to prepare for emerging, compound, and systemic risks by integrating foresight, future thinking and anticipatory governance. AA+ expands the horizon of anticipation from days and weeks to years and decades, creating a bridge between disaster risk reduction, climate adaptation, and long-term resilience building. Both anticipatory action and foresight approaches are already being used in parallel by institutions, including SDPI and various UN agencies. There is a need to bring the two together for a more resilient Pakistan.
The importance here lies not in the size of budgetary allocations for climate and disaster hazards, but in the institutionalisation of climate and disaster budgeting within Pakistan’s PFM system. The federal government has institutionalised disaster-responsive budgeting, mapped more than 5,000 cost centres, introduced disaster budget tagging, classified expenditures under preparedness, response, recovery and reconstruction, integrated climate budget tagging, and developed AI-enabled climate budget tracking and reporting systems.
This means climate and DRM spending is no longer treated as an ad hoc development activity but is gradually being embedded in treasury systems and budget classification frameworks. Integrated into the Medium-Term Performance-Based Budgeting framework, these reforms aim to enhance fiscal transparency and support a transition to risk-based financial management.
By taking these actions, Pakistan can now answer the question, ‘How much are we spending on climate resilience and disaster risk reduction?’ in the public finance context and in line with the practices of leading global financial institutions. As humanitarian advocates, we have long argued that disaster and climate resilience should not be viewed as stand-alone projects but as budgetary and governance issues. The new measures move Pakistan towards Disaster Budget Tagging (DBT), enabling tracking of expenditures related to preparedness, response, recovery and reconstruction, as well as evidence-based fiscal planning. This will improve the efficiency of disaster spending, resilience outcomes, and the identification of funding gaps in the future.
Budget 2026-27 shows allocations for disasters and DRM under separate heads rather than as a lump sum. Rs50 billion through the Ministry of Climate Change, with support from the UNFCCC Adaptation Fund and UN-Habitat, has been earmarked to develop a National Urban Strategy to minimise the impacts of urban flooding. Rs430 billion has been allocated under the provision for emergencies and others, of which only Rs20 billion is for disasters triggered by natural hazards during 2026-27. In addition, Rs4.28 billion has been allocated for preparedness, Rs3.27 billion for response, Rs2.14 billion for recovery and rehabilitation, and Rs1.91 billion for reconstruction. For NDMA, Rs1.048 billion has been allocated. The provinces have their own allocations under disaster-related heads. Similarly, BISP funding has been increased substantially, but there is no clear budget architecture linking BISP with drought, flood and heatwave triggers, and anticipatory cash transfers.
The challenge is that the allocations appear modest, as governance is improving faster than the financing architecture. This suggests that the federal government is now attempting to identify DRM-related expenditures across sectors rather than only through the disaster management architecture. The provinces must work through local governments and administrations to build resilience in local communities. One would still like to see allocations for Forecast-Based Financing, dedicated trigger-based funding, Early Action Protocols, financing linked to forecast triggers, and Shock-Responsive Social Protection in future budgets. Governments should also introduce dedicated AA+ allocations in their future budgets.
Pakistan is strengthening its disaster-risk financing architecture through disaster-budget tagging, climate-budget tagging, AI-enabled tracking and the classification of expenditures across preparedness, response, recovery and reconstruction. Institutions such as NDMA, PDMAs, DDMAs at the district level, SDMA, and GBDMA should be adequately funded for anticipatory action to cope with forthcoming monsoons and other forecast-based disasters. At the same time, strategic funds should be allocated to AA+, including foresight work.
Through AA+, we can improve actual resilience by anticipating the challenges of the next two decades as Pakistan approaches its centenary. This will depend on the volume of tagged expenditures and how much is allocated to AA+ for risk reduction rather than post-disaster response. This approach will yield dividends from the current institutionalised disaster-budget tagging system across more than 5,000 cost centres, ensuring adequate future allocations.
In the absence of a dedicated AA and AA+ financing window, we risk becoming better at tracking disaster spending than at financing prevention, preparedness and anticipatory and foresight-based actions.
The writer is an Islamabad-based policy analyst. He is currently the deputy executive director (policy) at SDPI, Islamabad and can be reached at: [email protected]
