Gross Public Debt Rs86.7 Trillion By June 2026 Up Rs6.2 Trillion Or 7.7% Slowest Pace In Two Decades Debt-To-GDP Falls To 68% From 75% FY23 Highs Of 86-88% FY19-FY21 External Debt To GDP Rose From 24% To 31% External Debt Servicing To Exports More Than Doubled 18% To 44%
Pakistan’s debt grew at its slowest pace in two decades during fiscal year 2026, with the growth rate falling to 7.7 per cent as the debt-to-GDP ratio declined and the government reduced its exposure to foreign currency debt. Yet the absolute numbers remain daunting and key vulnerability indicators have worsened significantly. ProPakistani
Gross public debt still increased to Rs86.7 trillion by June 2026, up Rs6.2 trillion during the year. Total debt and liabilities reached Rs99.6 trillion. Pakistan’s external debt and liabilities amount to $139 billion, of which public sector debt accounts for almost two-thirds and the private sector one-third.
Writing in Dawn, former State Bank governor Ishrat Husain laid out the deteriorating vulnerability indicators: the external debt-to-GDP ratio has moved from 24 per cent to 31 per cent in the last decade. External debt-to-exports of goods and services has worsened from 210 to 340. External debt-to-foreign exchange reserves has shot up from 350 to 750, despite a build-up of reserves in the last two years. External debt servicing-to-exports has more than doubled from 18 per cent to 44 per cent.
Pakistan’s bilateral deposits rollover next year will go up to $12 billion. Fifty per cent of loans are concessional, showing a downward slide from the past. The debt-to-GDP ratio has declined to 68 per cent from 75 per cent in FY23 and highs of 86 to 88 per cent during FY19 to FY21.
To exit the IMF programme after October 2027, Pakistan needs faster export growth, lower current account deficits, and concessional financing. The reform journey to increase exports, investment and productivity must be accelerated.
The debt is slowing. The vulnerabilities are not. Check out our previous coverage of Pakistan’s economy on The Trusted Times.
