Khyber Pakhtunkhwa (KP) government has inked agreements for Rs619 billion loans for various development projects in the province which would be a huge burden on the provincial exchequer.
The KP government signed agreements with the Asian Development Bank (ADB), World Bank and other financial institutions for Rs500 billion for development projects. Thus, KP’s loan burden has reached Rs619 billion.
On the other hand, the Awami National Party government had borrowed Rs21 billion during its five-year tenure as compared to the PTI. According to sources, the KP government has so far released more than 70 per cent of funds for projects after signing various agreements with international financial institutions. The repayment of loans for some of the projects will start from next year and would take 40 to 50 years.
The government has also borrowed more than Rs50 billion from the Asian Development Bank (ADB) and the Swiss Agency for the BRT project. The government has signed agreements to borrow a maximum of Rs305 billion from ADB for 14 development projects. Agreements have also been reached with the World Bank and the International Development Association for loans of Rs254 billion for 11 projects.
Similarly, Rs29.80 billion has been secured from Saudi Fund for Development (SFD) in terms of loans and grants for only two projects whereas Rs15.60 billion will be borrowed from International Fund for Agricultural Development. A loan of Rs53.32 billion has been obtained from ADB and Agence Française de Dévelopment (AFF) for Peshawar Bus Rapid Transit project.
Besides, agreements have also been signed with ADB for Rs10.15 billion from ADB for Peshawar Canal Expansion Project, Rs6.7 billion for FATA Water Resources Development Project and Rs13.2 billion for Mardan-Swabi Highway. ADB will also provide Rs68.71 billion for Balakot Hydel Power project.
Similarly, an agreement has been signed with the International Development Association (World Bank) for a loan of Rs18.29 billion for KP Revenue Mobilization and Resource Management project.
Recently, an agreement has been signed with the ADB for the highest loan of Rs101 billion for urban development in six districts – Swat, Bannu, Abbottabad, Peshawar, Kohat and Mardan. A loan of Rs28 billion will be obtained from ADB for construction of rural highways in 26 districts of the province.
The province will also obtain a loan of Rs18.91 billion from the International Development Association (World Bank) for education department in four districts of the province namely Peshawar, Nowshera, Swabi and Haripur. Rs14 billion will be obtained from the World Bank for tourism projects in the province, Rs30.4 billion for agricultural development projects and Rs64 billion for projects in the health and education sector. The World Bank will also provide Rs46.80 billion for Rural Investment and Institutional Support Project and Rs42.78 billion for energy projects.
The Finance Minister Taimur Saleem Jhagra has been approached several times to know about the government’s position on loans and its repayment, but he did not offer any response