Pakistan’s debt hits Rs72 trillion

The federal government’s total debt stock surged by over Rs3 trillion during the first seven months of the current fiscal year (FY25), primarily due to substantial borrowing from domestic sources to bridge the fiscal deficit.

Pakistan’s total debt rose by 4.65 percent in the first seven months of FY25, reaching Rs72.123 trillion in January 2025, up from Rs68.914 trillion in June 2024. This increase of Rs3.209 trillion was mainly due to higher domestic borrowing.

Domestic debt climbed by 6.5 percent, reaching Rs50.243 trillion in January 2025. Of this, Rs41.825 trillion was in long-term loans, while Rs8.352 trillion was in short-term loans. External debt saw a smaller rise, increasing by Rs126 billion to Rs21.880 trillion.

With limited external borrowing, the government has relied more on domestic resources to meet financial needs. The State Bank of Pakistan contributed over Rs3 trillion in profits to support fiscal operations, easing pressure on public finances.

Additionally, the Pakistan Stock Exchange raised Rs91.60 billion for the government in the 19th auction of GOP Ijarah Sukuk held on March 6, 2025. The auction attracted bids worth Rs207.90 billion across different tenures, with the government securing Rs6 billion at 10.999 percent for one-year GIS Discounted Sukuk.

Further borrowings included Rs28 billion through 3-year and 5-year GIS Fixed Rental Rate Sukuk at 11.49 percent and 11.98 percent, respectively, while Rs 57 billion was raised through 10-year GIS Variable Rental Rate Sukuk at 11.547 percent.