Centre Owes KP Rs532 Billion for Merged Districts Development Fund
The federal government owes Khyber Pakhtunkhwa a total of Rs532 billion under the head of merged district development allocations, according to figures that have come to light, deepening longstanding fiscal grievances between Islamabad and the province. The outstanding amount relates to funds due under the constitutional mandate following the merger of the erstwhile FATA areas into KP.
The merged districts — encompassing areas formerly under the Federally Administered Tribal Areas — were integrated into KP with the promise of accelerated development funding to address decades of underinvestment. The Rs532 billion figure represents accumulated arrears that provincial authorities say have not been transferred despite federal commitments.
Provincial officials and political representatives have long raised concerns about the centre's non-fulfillment of its financial obligations to the merged areas. The failure to release funds has hampered infrastructure development, service delivery, and security consolidation in some of Pakistan's most challenging terrain.
The disclosure of the full quantum of outstanding funds is expected to intensify pressure on the federal government to resolve the arrears. The matter is likely to feature prominently in upcoming inter-governmental fiscal discussions and National Finance Commission deliberations.
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