Public Debt Soars 76% to Rs86.7 Trillion

News Desk
ISLAMABAD: Pakistan’s total public debt has surged by 76% since June 2022, reaching Rs86.7 trillion as the government grapples with significant fiscal challenges.
The Ministry of Finance announced on Tuesday that gross financing needs (GFNs) for the current fiscal year have escalated to Rs28.65 trillion, prompting plans to borrow an additional Rs6.86 trillion to cover the budget deficit.
The Ministry’s Annual Borrowing Plan 2027 revealed that public debt rose from Rs49.3 trillion at the end of June 2022 to Rs86.7 trillion by June 2026.
This figure includes Rs59.4 trillion in domestic debt and Rs27.3 trillion in external debt.
The government plans to secure Rs6.046 trillion through domestic borrowing and Rs813 billion via external sources, with the total federal fiscal deficit projected at Rs7.020 trillion.
This dramatic increase in public debt raises concerns about the sustainability of Pakistan’s economy, as GFNs are expected to account for approximately 20% of the GDP for FY27.
The reliance on short-term treasury bills is set to decrease, with a strategic shift towards medium- to long-term instruments, including a targeted net issuance of Rs4.58 trillion in Pakistan Investment Bonds (PIBs).
Looking ahead, the government is expected to implement measures aimed at stabilizing the economy and managing debt levels effectively.
Stakeholders are keenly observing upcoming fiscal policies and potential reforms that may emerge in response to these pressing financial challenges.