very year, Pakistan invests billions in education. The outcomes remain sobering. Millions of children are still out of school and learning poverty persists among those enrolled as a majority cannot read a simple, age-appropriate text. Closing this gap has never been more urgent.

The past year has seen international development priorities shift sharply. Traditional aid flows have contracted. In early 2025, the United States disbanded the USAID, merging its functions with the State Department in a broad retreat from foreign aid. This has disrupted education and development programmes worldwide. At the same time, the United Kingdom has announced that it will reduce official development assistance to 0.3 percent of GNI by 2027. France and Germany have also announced reductions. Pakistan’s own federal and provincial budgets, unveiled in June 2025, have increased education allocations, a welcome signal of political intent, but inadequate to meet the scale and complexity of the challenge.

Against this backdrop, the Fourth Financing for Development Conference, held in Seville, Spain, in June-July 2025, delivered a clear message about the way the global development architecture is evolving and what countries like Pakistan should prepare for. Seville underscored the need for smarter, more accountable and more innovative approaches to mobilising and using resources, a message that speaks directly to Pakistan’s education reform agenda. At its heart, Seville calls on countries to start counting what counts.

The recently announced education budgets show recognition of education’s importance. The Punjab and Sindh have allocated around 18 percent of their budgets to education. Khyber Pakhtunkhwa has allocated 21 percent; Balochistan has earmarked 16 percent. Yet total spending remains modest, with education still below the globally recommended 4 to 6 percent of GDP. More critically, translating these budgets into outcomes remains uncertain. Development budgets for infrastructure, materials and teacher training are routinely underutilised. Fixing these inefficiencies requires stronger governance and better alignment between spending and results.

These budgets arrive amid sobering revelations. Across provinces, millions of children remain out of school, with girls, children with disabilities and those in remote or conflict-affected areas facing the most formidable barriers. In Balochistan, enrolment gaps are particularly stark. Among those enrolled, nearly 80 percent of late-primary-age children cannot read and understand a simple text, reflecting severe learning poverty and constraining Pakistan’s human capital development. Salaries still consume most of the education budget, leaving little for teachers’ professional development, remedial programmes and monitoring. To address both access and learning, Pakistan needs equity-driven investments that prioritise measurable gains over recurrent costs alone.

While Pakistan contends with its education challenges, the global landscape is also shifting. Seville confirmed that the era of grant-heavy, donor-led development is giving way to a paradigm grounded in domestic resource mobilisation, private capital and innovative financing. Earlier milestones, Monterrey, Doha and Addis Ababa, progressively repositioned education as a strategic pillar of sustainable development. Seville advanced and reframed this trajectory, embedding education within resilience, climate action and digital transformation. External aid is no longer a lifeline but a complement to credible domestic reforms and innovation.

In the backdrop of this evolving landscape, Pakistan needs to embed education more firmly in its development ambitions. Education is not just a social obligation but a driver of resilience, productivity and social cohesion. This narrative is already evident in initiatives such as Khyber Pakhtunkhwa’s Climate Ready Schools Framework and Punjab’s Guidelines for Climate Resilient Schools, which position education as a key component of climate adaptation. Pakistan’s aspirations for a digital economy and green growth also depend on equipping young people with relevant skills. Linking budgets to outcomes, preparedness for climate shocks, employability and gender equity can unlock broader political support and new financing streams, including climate funds and impact-aligned investments.

With aid receding and increasingly tied to domestic effort, Pakistan should strengthen its fiscal commitment to education, gradually but credibly. Rather than leaping to 4 percent of GDP, the focus should be on phased increases alongside efficiency reforms. Provinces can gain by rationalising teachers and non-teaching staff deployment, expanding double shift or afternoon schools and redirecting savings toward quality improvements. Incremental increases should also be tied to measurable gains in learning and inclusion, signalling seriousness to both citizens and partners. The government of Punjab’s performance-based transfers and Khyber Pakhtunkhwa’s Education Emergency Fund demonstrate how provincial governments can effectively link resources to results.

Given fiscal constraints and rising needs, innovative financing mechanisms are indispensable. Seville emphasised the need to diversify sources and instruments. Pakistan already has institutional foundations, such as the provincial education foundations, that can be scaled to channel resources more effectively. Partnerships with low-fee private schools through outcome-linked contracts, development impact bonds tied to literacy or enrolment, debt for education or climate swaps that redirect external debt to domestic investment and blended finance combining public funds, concessional loans and private capital can unlock new streams. Guarantee funds could encourage banks to lend to school operators. Corporate social responsibility, philanthropy and Diaspora remittances could also be mobilised through transparent, results-oriented platforms.

Education also requires greater political visibility and sustained ownership. While this government has declared an education emergency, follow-through remains uneven. High-level commitment, reinforced by parliamentary oversight, performance benchmarks and public engagement, is essential to keep education at the centre of the national agenda. Linking education outcomes to broader development goals, including economic growth, climate resilience and social stability, can help it compete more effectively for the necessary resources.

At this intersection of rising aspirations and shifting expectations, Pakistan’s education challenge is also its greatest opportunity. The new budgets, though imperfect, lay the groundwork, and the Seville agenda offers a clear path forward. For Pakistan, this means embedding education within climate, skills and growth strategies, steadily increasing and better utilising domestic resources, scaling innovative financing and making education a politically visible, outcome-driven priority.

By counting what counts, Pakistan can re-imagine education not as a liability but as its most strategic investment, building resilience, unlocking human capital and ensuring no child is left behind in shaping the country’s future and stability.

Ahmad Ali is affiliated with the Institute of Social and Policy Sciences. He can be reached at ahmadaley@gmail.com