PESHAWAR: Khyber Pakhtunkhwa’s government debt is projected to escalate dramatically, potentially reaching Rs2.55 trillion by 2030, as outlined in documents from the provincial finance department.
The analysis indicates a significant increase in both the principal debt and interest payments over the coming years.
Currently, the province’s debt stands at Rs632 billion, with expectations to rise to Rs725 billion by the end of 2024. The subsequent years will see substantial increases: Rs215 billion in 2025 bringing the total to Rs940 billion, and by 2026, an additional Rs284 billion due largely to international aid agency loans, culminating in a debt of Rs1.224 trillion.
The projections continue to climb steeply with an anticipated increase of Rs353 billion in 2027, and Rs455 billion in 2028, leading to a total debt of Rs2.032 trillion by the end of the current government’s term. By 2030, the total provincial debt is expected to swell by another Rs177 billion, reaching Rs2.555 trillion.
Debt repayments are also set to rise, from Rs19 billion paid in 2023 to a projected Rs198 billion in 2030. The total debt repayment from 2023 to 2030 is estimated at Rs935 billion, with Rs355 billion accounted for as interest.
This burgeoning debt is a serious concern for Khyber Pakhtunkhwa, potentially hindering its developmental progress and straining its financial resources. The provincial finance department has cautioned that without proper debt management, the province could face a significant financial crisis. Measures are being urged to manage this looming debt and ensure sustainable development amidst these challenging financial forecasts.
