ISLAMABAD/PESHAWAR: Khyber Pakhtunkhwa has received Rs799.359 billion under the additional 1% war-on-terror share from 2010-11 to September 2026, according to official documents.
The funds are provided to compensate the province for economic, infrastructure and other financial losses linked to terrorism and the security challenges faced by the province.
KP receives additional 1% share
Under the 7th National Finance Commission (NFC) Award, agreed in December 2009 and implemented from July 2010, Khyber Pakhtunkhwa receives an additional 1% share from the federal divisible tax pool.
The arrangement was introduced in recognition of the exceptional security and economic pressures faced by the province because of terrorism.
According to the documents, KP received Rs112.296 billion in 2024-25, while Rs128.234 billion was released during 2025-26.
For the current fiscal year 2026-27, the war-on-terror allocation has been estimated at Rs149.076 billion. Of this amount, Rs23.069 billion had been released during the first two and a half months of the fiscal year.
Funds linked to federal revenue collection
The KP Finance Department said the size of the allocation is linked to Federal Board of Revenue collection targets.
According to the department, the province receives the full amount when the federal government achieves its revenue collection targets.
However, sources said the war-on-terror funds do not have a separate head in the province’s Consolidated Fund. The money is transferred into the provincial account along with other revenues, making it difficult to track its utilisation through a dedicated expenditure head.
Security challenges remain
The release of the funds comes as Khyber Pakhtunkhwa continues to face serious security challenges and militant violence.
A report cited in the documents showed that KP remained among the worst-affected regions in the country in terms of violence-related incidents and fatalities during the second quarter of 2026.
Several deadly attacks have also been reported in the province in recent months, while security forces have continued intelligence-based operations against militant groups.
In late September, security forces killed three militants during an operation in North Waziristan. Other operations have also targeted militant positions in areas along the Afghan border.
Police budget increased
The security situation has also led to increased spending on policing in the province.
KP Finance Adviser Muzzammil Aslam said the police operational budget had been increased from Rs15 billion to Rs30.2 billion.
He also said the sanctioned strength of the provincial police had been increased to 139,318 posts.
The additional 1% share under the NFC Award remains an important source of federal funding for KP as the province continues to deal with the economic and security impact of terrorism.
The latest figures highlight the scale of federal financial support provided to Khyber Pakhtunkhwa over more than 16 years and the continued financial requirements created by the province’s security challenges.
