Pakistan’s government debt surges 13% to PKR 77.9 trillion in FY25
State Bank data shows domestic borrowing up 15.5% as fiscal pressures mount and external funding lags
Business Desk
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Pakistan’s government debt jumped by 13% in the fiscal year ending June 30, reaching PKR 77.89 trillion, up from PKR 68.91 trillion a year earlier, according to data released by the State Bank of Pakistan (SBP).
The increase was driven largely by a sharp rise in domestic borrowing, which surged 15.5% to PKR 54.47 trillion. Meanwhile, external debt rose 7.6% to PKR 23.42 trillion, the central bank reported.
Economists say the rise in domestic debt reflects the government’s growing reliance on local borrowing to finance its widening fiscal deficit.
“The uptick in domestic debt shows the pressure on public finances amid limited access to external funding and delays in inflows from international partners,” said an analyst. “Without structural reforms, this trend could pose serious challenges to debt sustainability in the coming years.”
Pakistan has struggled with mounting fiscal and external account pressures in recent years, prompting repeated negotiations with the International Monetary Fund (IMF) for bailout support. Rising debt levels are a key concern for both domestic policymakers and international lenders.
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