KP Budget 2026-27 Likely To Exceed Rs2.3 Trillion As Development Spending Expands
- Khyber Pakhtunkhwa’s budget for FY2026-27 is expected to exceed Rs2.3 trillion.
- The province is likely to receive Rs1.671 trillion from the federal government and Rs107 billion in net hydel profits.
- Around Rs334 billion is expected to be allocated for development and infrastructure projects in the merged districts.
The Khyber Pakhtunkhwa government has finalized preparations for its Budget 2026-27 and Annual Development Programme, with the overall budget size expected to exceed Rs2.3 trillion as the province focuses on development spending, public services and economic growth.
According to official sources, the provincial government has completed most of the budget planning process and is expected to present a financial plan centered on infrastructure development, revenue generation and improved service delivery across the province.
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A major portion of the province’s expected income will come from federal transfers. Sources said Khyber Pakhtunkhwa is likely to receive approximately Rs1.671 trillion from the federal government during the next fiscal year under various fiscal arrangements.
The province is also expected to receive around Rs107 billion in net hydel profit, which remains one of Khyber Pakhtunkhwa’s most important revenue sources due to its role in electricity generation.
In addition to federal transfers, the provincial government expects to generate Rs150 billion through its own resources. Of this amount, approximately Rs99 billion is projected to come from tax collection, while another Rs51 billion is expected through non-tax revenues and other income streams.
The upcoming budget is also expected to place considerable emphasis on the merged districts. According to sources, around Rs334 billion is likely to be allocated for ongoing development projects, infrastructure improvements and public service initiatives in the former tribal districts.
Officials believe these investments will help accelerate socio-economic development, improve connectivity and strengthen access to education, healthcare and other essential services in the region.
For the settled districts of the province, the proposed budget is expected to total around Rs1.971 trillion. The allocation reflects the government’s efforts to maintain development spending while meeting administrative, operational and governance requirements.
The budget is expected to outline the provincial government’s priorities for the next fiscal year, including economic growth, infrastructure expansion, public welfare programmes and service delivery improvements.
The proposed financial plan comes as the Khyber Pakhtunkhwa government continues efforts to balance development needs with fiscal sustainability, while seeking to enhance revenue generation and accelerate the completion of key public sector projects.
With an expected budget exceeding Rs2.3 trillion, the upcoming fiscal plan is likely to be one of the largest in the province’s history and will play a key role in shaping Khyber Pakhtunkhwa’s economic and development agenda during FY2026-27.
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