KP presents Rs2.17tr budget for FY2026-27 with Rs48bn deficit

Education, youth and human capital development

The KP budget FY2026-27 includes significant investments in education and human capital development aimed at improving access and quality across the province.

An amount of Rs11.9 billion has been allocated for government universities. Additionally, Rs 8.7 billion is earmarked for human capital investment projects to strengthen skills development and institutional capacity.

For student support, Rs8.5 billion has been proposed for free textbooks and ESEF grants, while Rs 5 billion will go toward initiatives for out-of-school children.

The government has also allocated Rs3.3 billion for outsourcing underperforming schools and Rs 2 billion for interest-free loans to students, aiming to improve access to higher education and reduce financial barriers.

Teacher recruitment, special education initiatives

The budget includes Rs1.7 billion for teacher recruitment to address staffing gaps in educational institutions across the province.

In addition, Rs145 million has been allocated for religious seminary students, reflecting support for diverse educational streams within the province.

For sports infrastructure, the government has proposed Rs358 million for the development of Kalam Cricket Stadium, aiming to promote sports activities and youth engagement in the region.

Tax relief and economic incentives

The budget proposes several tax relief measures to support citizens and businesses. Residential and commercial properties up to five marla will be exempted from tax.

The hotel bed tax is proposed to be reduced from 7 percent to 5 percent, while professional tax will be abolished for individuals earning minimum monthly income.

Employees in pay scales 1 to 6 are also proposed to be exempted from professional tax.

Tax relief policies for former FATA and PATA regions will continue under the existing framework.

Additionally, the infrastructure development cess is proposed to be reduced from 2 percent to 0.75 percent, aiming to ease business costs and encourage economic activity.

Law and order and security spending

A major portion of the budget—over Rs 191 billion—has been allocated for law and order.

This includes:

• Rs14.5 billion for police equipment
• Rs7.774 billion for weapons and ammunition
• Rs1.817 billion for bulletproof APCs and vehicles
• Rs3.562 billion for drones, thermal cameras, jammers, and communication systems
• Rs600 million for a forensic science laboratory in Peshawar
• Over Rs3 billion for safe city projects in Upper and Lower Dir, South Waziristan, Orakzai, Kurram, Khyber, Mohmand, and Bajaur

These investments aim to strengthen policing capacity and improve security infrastructure across sensitive districts.

Supplementary budget

The Chief Minister of Khyber Pakhtunkhwa has presented the supplementary budget for the current fiscal year, outlining significant additional expenditures across various departments.

Chief Minister Sohail Afridi said that more than Rs121.47 billion was spent in the supplementary budget. He added that Rs50.49 billion was spent under current expenditure, while Rs71.73 billion was utilized under the development budget.

He further stated that the supplementary budget includes additional expenses incurred by different departments during the year.

According to the details shared, the Administration Department spent an additional Rs791.9 million, while the Planning and Development (P&D) Department spent Rs42 million extra. The Revenue Department recorded additional spending of Rs323.6 million, whereas the Home Department spent Rs1.38 billion more than its allocation.

The Prisons Department spent an additional Rs514.1 million, while the Police Department’s extra expenditure stood at over Rs753 million. The Administration of Justice also incurred a higher spending of Rs6.51 billion.

In the local governance sector, municipalities spent Rs1.29 billion more, while local councils recorded additional expenditure of Rs7.50 billion. The Transport Department also spent an extra Rs1.46 billion during the period.

On the development and social sector side, relief funds recorded additional spending of Rs7.35 billion, while merger districts saw an extra Rs3 billion spent. The Social Welfare Department’s additional expenditure stood at Rs4.43 billion.

The Forest Department reported a significant increase of Rs41.29 billion in spending, while the Information Department recorded Rs70.65 billion in additional expenditure.

Chief Minister Sohail Afridi said that both current and development expenditures reflect ongoing financial requirements across departments during the fiscal year.