KP grapples with whopping Rs608b deficit in FY24

  • Provincial govt received Rs971.46b so far against an estimated total revenue of Rs1,579.65b

PESHAWAR: Khyber Pakhtunkhwa is facing a deficit of Rs608.18 billion in the current financial year due to a shortfall in grants from the federal government, including funds for tribal districts development, net profit of hydel power, war against terrorism, current expenditures, and other grants.

The provincial government had estimated its total revenue from federal and provincial sources at Rs1,579.65 billion for the current fiscal year, of which it has received Rs971.46 billion so far. The budget estimates for the settled districts are Rs1,366.76 billion and for the tribal districts Rs212.89 billion. The federal grant for the current year was estimated at Rs764.61 billion, but the province is likely to receive Rs504 billion. For the war against terrorism, Rs60.55 billion has been paid out of the estimated Rs91.87 billion.

In the head of straight transfer, Rs26.05 billion has been received out of the estimated Rs38.66 billion. For the current year, Rs20.52 billion has been paid out of the estimated Rs31.51 billion in net profit of hydel power. In addition, Rs37.13 billion has been received out of the outstanding Rs56.39 billion of net profit of hydel power. The Khyber Pakhtunkhwa government has also faced a shortfall in revenue from its own sources during the current year.

Against the target of Rs28.51 billion, only Rs19.60 billion has been collected in provincial excise (non-tax). Similarly, against the target of Rs56.48 billion, Rs37.65 billion has been collected in provincial excise (tax). Out of the estimated Rs72.64 billion from other sources, Rs24.21 billion has been collected. Against the estimated Rs34.26 billion in operational shortfall/savings, Rs11.42 billion has been received.

Against the estimated Rs138.92 billion in foreign aid-funded projects, Rs83.17 billion is likely to be received. Out of the Rs11.31 billion Public Sector Development Program (PSDP), Rs7.54 billion has been received. Against the additional demand of Rs86.10 billion for the tribal districts, only Rs28.70 billion has been received.

In the Annual Development Program (ADP), Rs17.33 billion has been paid out of the estimated Rs26 billion. Out of the Rs31 billion allocated for the Accelerated ADP, Rs23.23 billion is likely to be received. Against the estimated Rs3.79 billion for foreign aid-funded development projects in the tribal districts, Rs2.52 billion is likely to be received.

The shortfall in grants from the federal government is putting a severe strain on the provincial government’s finances. The provincial government has been forced to cut spending on development projects and essential services to meet its financial obligations.

The provincial government has called on the federal government to release the remaining funds so that it can complete its development projects and provide essential services to the people of Khyber Pakhtunkhwa.

Aziz Buneri
Aziz Buneri
Author is a senior journalist and working in the field of journalism since 2004. He covers Financial, Social, Political and regional issues for Pakistan today and Profit. He can reached at [email protected]

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