ISLAMABAD: Pakistan’s total debt climbed to Rs80.52 trillion, including $91.8 billion in external liabilities, reflecting a significant increase and further straining the country’s debt-to-GDP ratio. The latest figures highlight growing fiscal challenges despite policy targets aimed at controlling debt levels.
According to the Debt Policy Statement presented in the National Assembly of Pakistan, external debt rose by 6% year-on-year to $91.8 billion by the end of June 2025, marking an increase of $5 billion. However, during the first quarter of fiscal year 2026, it slightly declined by 0.4%, or $0.35 billion, to $91.4 billion.
Meanwhile, the Ministry of Finance Pakistan reported that total public debt increased from Rs71.25 trillion in June 2024 to Rs80.52 trillion in June 2025. Officials attributed the surge primarily to rising interest payments. On a per capita basis, debt also grew notably, rising from Rs294,098 in FY2024 to Rs333,041 in FY2025.
In addition, domestic debt recorded a sharp increase, rising by Rs7,312 billion to reach Rs54,472 billion by June 2025. Although this marked a 16% year-on-year rise, it remained lower than the 22% growth recorded during the same period in the previous fiscal year.
Furthermore, much of the increase in external borrowing came from multilateral lenders, including the International Monetary Fund, with inflows rising by 8.7%, or nearly $4 billion.
Under the Fiscal Responsibility and Debt Limitation Act (FRDLA) 2005, Pakistan aimed to reduce its debt-to-GDP ratio to 60% by 2017-18 and gradually bring it down to 50% by 2032-33. However, authorities acknowledged that public debt has continued to rise both in absolute terms and relative to GDP, underscoring persistent economic pressures.
