PESHAWAR: The Khyber Pakhtunkhwa government’s debt liability surged to Rs836.4 billion at the end of the last fiscal, up from Rs776.32 billion a year ago, showing a 7.7pc year-on-year increase, according to a government document.
The Annual Debt Statistical Bulletin, released on Nov 11 and available on the finance department’s website, shows that the province spent Rs50.5 billion on principal and interest repayments from July 2025 to June 2026.
Of this amount, Rs33.3 billion went toward principal repayment, while Rs17.2 billion covered interest payments.
Govt document says Rs50.5bn spent on principal, interest repayments from July 2025 to June 2026
The bulletin stated that the province currently managed a portfolio of 101 loan funded projects obtained from international development partners.
“Out of these, 30 projects are in the active phase, where disbursements continue in line with implementation schedules. The remaining 71 are closed in the repayment stage, requiring regular debt servicing in the shape of principal and interest amount in accordance with agreed amortisation schedules,” it said.
The International Development Association topped the list of creditors or lenders with a total of 45 loans and its outstanding debt of Rs377.5 billion on June 30, 2025, which amounted to 45pc of the total debt. Besides, the Asian Development Bank (ADB) was second on the number of creditors with a total of 44 loans and its outstanding debt amounted to Rs352.6 billion, or 42.1pc of the total debt.
Similarly, French Development Agency had an outstanding amount of Rs36.6 billion, Japan International Cooperation Agency Rs20.9 billion, Asian Infrastructure Investment Bank Rs40 billion, International Fund for Agriculture Development Rs7.1 billion and International Bank for Reconstruction and Development Rs1 billion outstanding on June 30, 2026.
Also, 87 loans with an outstanding liability of Rs612.7 billion were denominated in the US dollar, while 4 loans totalling Rs122 billion were denominated in the euro, and 7 loans worth Rs99.7 billion in the Japanese yen.
Sector-wise breakdown of KP debt portfolio showed that the transport and communication sector accounted for the highest portion of the outstanding liability which stood at Rs202.3 billion or over 24pc of total debt.
Similarly, energy and power department liabilities were the second highest at Rs106.2 billion and accounted for over 12pc of the portfolio. Finance stood third with Rs104.7 billion outstanding debt liability which also amounted to over 12pc of the total outlay.
Also, water and urban infrastructure sector debt liability stood at Rs82.9 billion, economic development Rs76.2 billion, rural development Rs76.1 billion, agriculture Rs47.4 billion, irrigation Rs36.1 billion, health Rs27 billion, health and education Rs24.4 billion, tourism Rs19.7 billion and regional development Rs18.4 billion.
Similarly, the outstanding debt stock of the education sector stood at Rs7.8 billion, social welfare Rs3.2 billion and environment Rs2.7 billion.
The document stated that in 2024-25 principal and interest repayment of debt cost the province Rs49.3 billion, against actual receipts of Rs1.2 trillion for the year.
On the other hand, in 2025-26, principal and interest repayment cost the province Rs50.5 billion out of Rs1.4 trillion actual receipts.
The bulletin said that the year-on-year sustainability ratio also improved as interest payment as per cent of total receipts decreased to 1.21pc from 1.51pc in the preceding year.
Similarly, debt servicing as per cent of total receipts also decreased from 4.1pc in 2024-25 to 3.5pc in 2025-26.
Published in Dawn, November 14th, 2026
