By Aminu Abubakar

Kaduna State has borrowed a total of N41.3 billion loan in the first quarter of 2025, according to figures from the state’s Q1 budget performance report.

All of the funds were sourced from international lenders, further fueling concerns about Kaduna’s rising exposure to foreign debt and the long-term sustainability of its fiscal policies.

A breakdown of the borrowing shows that N26.9 billion was obtained from international financial institutions, N7.4 billion from foreign government entities, and N6.9 billion from international capital markets.

This borrowing pattern underscores the state’s increasing reliance on external financing sources, exposing it to risks associated with exchange rate volatility and fluctuating global interest rates.

SolaceBase reports that the new borrowing comes in spite of repeated warnings by economic analysts and federal authorities, urging subnational governments to curb their appetite for loans, especially foreign ones.

Read Also: High poverty rate fails to deter frivolous spending by Kano, Kaduna state govts

The case of Kaduna State is particularly notable, as Governor Uba Sani has publicly criticized the scale of debt inherited from his predecessor, Nasir El-Rufai.

In March 2024, Governor Sani revealed during a town hall meeting at the Umaru Musa Yar’Adua Hall in Kaduna that his administration had inherited a debt portfolio comprising $587 million in external debt, N85 billion in domestic debt, and 115 contract liabilities as of May 29, 2023, when he assumed office.

The Q1 2025 financial report indicates that in addition to the N41.3 billion borrowed, the state received N50.3 billion from the Federation Account Allocation Committee (FAAC) and generated N19.2 billion in Internally Generated Revenue (IGR), bringing its total revenue for the quarter to N69.5 billion. However, a substantial N18.515 billion—roughly 27% of total revenue—was spent on debt servicing during the same period, highlighting the pressure debt obligations are placing on the state’s finances.

Read Also: Amid out-of-school children and water scarcity, Sokoto approves N1.6bn for lawmakers’ vehicles in 2025

As of December 2024, Kaduna’s external debt had risen to $625 million, making it the second most externally indebted state in Nigeria, after Lagos. Analysts warn that the state’s growing debt stock, combined with rising debt service costs, could significantly reduce funds available for essential services, infrastructure, and social programs.

In 2024 alone, Kaduna State borrowed N52.2 billion, all from international sources. This brings the total amount borrowed between January 2024 and March 2025 to N93.5 billion, a figure that many observers consider unsustainable without a clear repayment and revenue diversification strategy.

The trend has reignited debates surrounding the fiscal responsibility of subnational governments in Nigeria. Experts argue that unless Kaduna State adopts a more sustainable debt management framework and aggressively improves its IGR base, it may find it increasingly difficult to meet its financial obligations without resorting to further borrowing.

Read Also: Security Budget 2024: Kano, Katsina outspend others in Northwest, Jigawa trails

Over time, stakeholders have emphasized the importance of fiscal reforms, calling for increased transparency, improved public expenditure efficiency, and strategic investment in revenue-generating sectors. Without such measures, Kaduna may continue on a path of mounting debt with diminishing returns for its citizens.