PESHAWAR: The Khyber Pakhtunkhwa government has placed Rs150 billion in a Debt Management Fund to ensure the timely repayment of provincial debts and improve financial stability.
Finance and Interprovincial Coordination Advisor Muzammil Aslam shared this during a post-budget press conference in Peshawar on Saturday.
He said the province’s total debt stands at around Rs 709 billion and will be gradually repaid through this fund. He added that the government is earning a daily profit of Rs 60 million from the fund and expects to generate Rs 17 to Rs 18 billion during the fiscal year.
Aslam said the government repaid Rs 49 billion in loans during fiscal year 2024–25, including Rs 18 billion in mark-up. He said there is no plan to take new loans in 2025–26 unless required for new projects.
The advisor said the provincial government has increased annual development financing to Rs 153 billion and included 810 development schemes worth Rs 500 billion in the upcoming budget. He said Rs 156 billion was allocated for settled areas in the current year, and over Rs 145 billion had already been released.
For merged districts under the Accelerated Implementation Program, Rs 41 billion was allocated, of which Rs 26 billion has been released so far.
He said KP received Rs 74 billion in foreign assistance and grants during the outgoing fiscal year out of a total of Rs 143 billion allocated. He added that Rs 278 billion from the province’s own resources will be used for development in the next fiscal year.
The government has imposed a professional tax on individuals earning Rs 40,000 per month. The throw-forward period of ongoing schemes has been reduced from 10 years to 5.1 years. Funds for public sector universities have been raised from Rs 3 billion to Rs 10 billion.
He said 36.5 percent of the total budget will be spent on education and health sectors.
Aslam said the province had not received full payment under the NFC Award and Net Hydel Profit in the past, but expects to receive Rs 70 billion from the federal government in the next fiscal year. He said the federal government is currently paying Rs 3 billion monthly to KP for net hydel dues.
He said 30 forms of allowances have been given to government employees. The disparity allowance for secretariat employees was increased by 30 percent.
Police salaries have been equalized with Punjab and increased by 10 percent.
On taxation in former FATA and PATA, Aslam said sales tax has been imposed by the federal government at the request of the business community, while exemptions on income and withholding taxes have been maintained.
Responding to a question, he criticized the federal and Punjab governments for not allowing him to meet PTI founder Imran Khan to discuss budget proposals. He said Chief Minister Ali Amin Gandapur was allowed to meet Khan and the provincial government wants direction from the party leadership before finalizing decisions.
He added that the federal government is responsible for arranging the meeting.
