Govt approves nearly Rs36bn AIP funding for merged districts of KP

June 18, 2025 (MLN): A major funding package of Rs35.968 billion has been released by the Ministry of Planning, Development and Special Initiatives with the approval of Prime Minister Shehbaz Sharif for the merged districts of Khyber Pakhtunkhwa under the Accelerated Implementation Programme (AIP).

This approval, issued in accordance with the Prime Minister’s directives, marks a critical step toward the sustained development and uplift of the Newly Merged Areas (formerly FATA), aiming to ensure inclusive growth and long-term stability in the region.

The initiative falls under the broader Ten-Year Development Plan for Ex-FATA, implemented through the Federal Public Sector Development Programme (PSDP) 2024–25, as per the press release issued.

With this latest funding authorization, the total allocation for the AIP Programme under the current fiscal year reaches Rs42.315bn.

Federal Minister for Planning, Development and Special Initiatives, Ahsan Iqbal, emphasized the significance of this investment.

“We are unlocking Rs35bn for the Newly Merged Areas, one of the biggest investments for the uplift of the area and the communities have ever seen”, he said.

“It’s not just numbers; it’s hope for families who have waited too long for light, for education, for safety”, Ahsan Iqbal added.

The allocated funds will support a series of transformative projects aimed at bridging development gaps and improving living standards across the region.

Key initiatives include the solarization of off-grid households, with Rs13.5bn set aside to provide solar energy solutions to 120,000 households or implement a 50 MW utility-scale micro grid, ensuring sustainable and affordable power access.

Additionally, Rs7bn has been allocated for the construction of police stations and police posts, including the transformation of the Levies forces, to enhance law enforcement capacity and public safety in the region.

The development of FATA University has also been given, with Rs2.5bn earmarked for strengthening its academic and institutional infrastructure, providing youth from the region with greater access to quality higher education.

Furthermore, an amount of Rs13.145bn, as requested by the Government of Khyber Pakhtunkhwa, has been authorized to clear outstanding liabilities for ongoing schemes, ensuring the timely completion of critical infrastructure and development projects.

Minister Ahsan Iqbal reiterated the government’s commitment to inclusive development: “These are real steps toward a better, brighter future. Our message is simple: Newly Merged Districts are an important priority of the Federal Government.”

“We look forward to working with the KP government above partisan lines for the development of a region, which has suffered greatly due to terrorism”, he noted.

This landmark funding package reaffirms the federal government’s resolve to uplift underdeveloped regions and integrate them fully into the national development framework, ensuring equitable growth, improved governance, and social cohesion across Pakistan.

Funds may be utilized under the supervision of a steering committee headed by CM KP, with Minister Finance KP, a federal Minister & Secretary Planning and rep of 11 Corp HQ as members.