KP Budget 2025-26 at a glance

Peshawar, June 13, 2025 – The Government of Khyber Pakhtunkhwa (KP), led by Pakistan Tehreek-e-Insaf (PTI), presented its annual budget for the fiscal year 2025-26 today while maintaining a projected surplus of Rs. 157 billion.

Presenting the annual budget, Finance Minister KP Aftab Alam said that the estimated annual expenditures for the new fiscal year would be Rs 1962 billion with a surplus of Rs157 billion.

He said that the budget presentation highlighted KP’s achievement of delivering the highest budgetary surplus among Pakistan’s provinces in the outgoing fiscal year, despite challenges like underfunding of merged districts and delayed Net Hydel Profit (NHP) payments.

The Annual Development Programme (ADP) soared to a historic Rs. 195 billion, a 62% increase, making it the largest developmental portfolio in the province’s history. The budget allocates significant funds to priority sectors, aiming to enhance service delivery, create jobs, and empower marginalized communities.

Major Budget Allocations for 2025-26

Below are the key allocations with brief descriptions, showcasing the government’s focus on education, health, social protection, and infrastructure:

1. Elementary & Secondary Education: Rs. 363.4 Billion
   • The largest allocation, with a 14% increase, targets education reforms, including Rs. 5 billion to enroll out-of-school children, Rs. 2.1 billion for girls’ community schools, Rs. 8.5 billion for free textbooks and school bags, and Rs. 2.5 billion for school reconstruction.
2. Health: Rs. 276.5 Billion
   • Up by 19%, this includes Rs. 11.9 billion for medicines, Rs. 909.2 million for cancer treatment, Rs. 912 million for polio eradication, and expansion of the Sehat Card Plus program to cover liver, kidney, and bone marrow transplants, plus cochlear implants.
3. Home & Tribal Affairs: Rs. 172.7 Billion
   • Funds enhanced allowances and Shuhada packages for KP Police, alongside security measures in merged districts, reflecting the province’s focus on stability and law enforcement.
4. Communication & Works: Rs. 122.8 Billion
   • Supports infrastructure development, including Rs. 4.6 billion for road maintenance and Rs. 7.8 billion for road construction across divisions like Peshawar, Malakand, Hazara, and Mardan.
5. Debt Servicing: Rs. 98.3 Billion
   • Allocated to manage KP’s foreign loans (Rs. 723.2 billion outstanding), with Rs. 150 billion in a Debt Management Fund to ensure sustainable repayments at low interest rates (2-4%).
6. Planning & Development: Rs. 78.2 Billion
   • Drives the record ADP, funding new schemes for job creation, regional development, and economic growth, particularly in merged districts.
7. Local Government: Rs. 56.2 Billion
   • Includes Rs. 15.2 billion in grants to local councils and Rs. 45.6 billion for district-level ADP, empowering local bodies as per the Local Government Act.
8. Higher Education, Archives & Libraries: Rs. 49.7 Billion
   • Up by 14%, with Rs. 10 billion for public sector universities and Rs. 1.4 billion for new government colleges, boosting higher education access.
9. Irrigation: Rs. 45.5 Billion
   • Funds water management projects to enhance agricultural productivity and resilience in settled and merged districts.
10. District ADP: Rs. 45.6 Billion
    • Earmarks 20% of funds for local bodies, supporting grassroots development in settled (Rs. 39 billion) and merged districts (Rs. 6.6 billion).
11. Revenue & Estate: Rs. 36.1 Billion
    • Strengthens land administration and revenue collection, targeting a 38% growth in own-source revenue without raising taxes on citizens.
12. Public Health Engineering: Rs. 32 Billion
    • Includes Rs. 6.6 billion for water supply schemes and sanitation reforms, with regional allocations like Rs. 1.3 billion for northern districts and Rs. 725 million for merged districts.
13. Energy & Power: Rs. 29.6 Billion
    • Supports projects like the 84MW Gorkin-Matiltan Hydropower Project (Rs. 1 billion) and solarization of worship places (Rs. 664 million).
14. Agriculture: Rs. 26.1 Billion
    • Allocates Rs. 330 million for locust control and Rs. 500 million for agricultural reforms to boost food security.
15. Social Welfare: Rs. 19.2 Billion
    • Up by 135%, funds initiatives like Rs. 1.2 billion for a Center of Excellence for autistic children and Rs. 675 million for Panagahs (shelters).
16. Livestock & Dairy Development: Rs. 17.4 Billion
    • Includes Rs. 630 million for vaccines and Rs. 300 million for fisheries in merged districts to enhance meat and milk production.
17. Transport & Mass Transit: Rs. 10 Billion
    • Subsidizes BRT operations (Rs. 4 billion) and procures new buses (Rs. 4 billion) to improve urban connectivity in Peshawar.

The budget also emphasizes youth empowerment through Rs. 1.5 billion for the Ehsaas Naujawan Program, environmental sustainability with Rs. 454 million for climate change projects, and tourism development with Rs. 894 million for roads to tourist areas. Despite challenges like inconsistent NHP payments and underfunded merged districts, KP’s budget balances fiscal responsibility with ambitious social and economic goals, aiming to transform the province into a model of inclusive growth.

Budget 2025-26- All Stories