The National Highway Authority (NHA) is grappling with mounting financial challenges, with its total debt surging to Rs3.1 trillion and aggregate losses exceeding Rs1.82 trillion in the ongoing fiscal year, Dawn reported.
Despite having assets valued at Rs5.8 trillion, the authority’s revenues remain significantly low at Rs54.15 billion, raising concerns over its financial sustainability.
In a written statement to the National Assembly, Minister for Communications Abdul Aleem Khan disclosed that the NHA’s net deficit for the fiscal year 2024-25 stands at Rs318.03 billion, reflecting a 23% decrease from Rs413 billion recorded in the previous year. However, the deficit has nearly doubled compared to FY22, indicating a persistent financial strain.
The minister clarified that the federal government provides development funds to the NHA through cash development loans under the Public Sector Development Programme (PSDP) at specified markup rates.
He argued that the reported deficit includes non-cash expenditures, such as finance costs on PSDP loans, exchange losses on foreign debt, and depreciation. “The NHA is not incurring financial losses in real terms, as these factors are accounting adjustments rather than actual cash outflows,” he asserted.
A report by the Central Monitoring Unit (CMU) of the Ministry of Finance states that the NHA’s outstanding debt is growing at an annual rate of Rs300 billion, with its current markup obligation at Rs98 billion. This figure is projected to exceed Rs150 billion annually, intensifying credit risks for the government, which guarantees these loans.
The Ministry of Finance has identified three primary financial risks facing the NHA: credit risk, market risk, and operational risk. The authority’s reliance on debt, combined with escalating interest payments, places the government at substantial financial risk. With debt increasing by Rs300 billion annually, its obligations are set to grow, further straining fiscal resources.