Pakistan’s public and publicly guaranteed debt has climbed to Rs90.98 trillion, rising by Rs6.21 trillion in a single fiscal year, according to fresh figures shared by a senior Finance Ministry official. The new data, reported on 3 November 2026, shows the country’s debt stock swelling from Rs84.77 trillion in June 2025 to Rs90.98 trillion by the end of June 2026 — a 7.3 per cent increase in twelve months.
The headline figure is the highest nominal debt stock Pakistan has ever carried. Yet buried in the same briefing is a more encouraging trend: the debt is growing more slowly relative to the size of the economy, with the debt-to-GDP ratio falling by 2.6 percentage points over the year.
The headline numbers
The official, speaking to The News on Monday, broke the Rs6.21 trillion increase into its two components. Public debt itself rose by Rs6.2 trillion, reaching Rs86.7 trillion by end-June 2026, up from Rs80.5 trillion a year earlier — a 7.7 per cent jump. Publicly guaranteed debt, the portion the government has backed rather than borrowed directly, increased by only about Rs0.01 trillion (roughly Rs10 billion).
So while the combined public and publicly guaranteed (PPG) debt crossed the Rs91 trillion mark in round terms, the guarantees component barely moved. Almost all of the increase came from direct public borrowing.
The pace of accumulation has also slowed compared with earlier years. Analysts tracking State Bank data note that the central government’s debt grew at its slowest pace in at least 15 years during FY26, a sharp retreat from the 23 per cent growth recorded as recently as fiscal year 2023.
The good news: debt-to-GDP is falling
The most important ratio in any debt debate is not the headline number but what the country owes relative to what it produces. On that measure, Pakistan’s position improved over FY26.
The PPG debt-to-GDP ratio fell from 74.3 per cent in June 2025 to 71.7 per cent by the end of June 2026 — a decline of 2.6 percentage points. The public-debt-to-GDP ratio dropped from 70.6 per cent to 68.3 per cent over the same period.
Why did the ratio improve while the stock kept rising? Three factors did the heavy lifting. First, nominal GDP grew faster than the debt itself. Second, the federal government recorded a primary surplus of Rs2.18 trillion — spending less than it collected before interest payments. Third, the government bought back expensive debt ahead of maturity.
The relief shows up most clearly in the interest bill. Interest payments fell by Rs1.94 trillion, or 21.7 per cent, from Rs8.88 trillion in FY25 to Rs6.95 trillion in FY26. That single line item — nearly two trillion rupees saved — is larger than the entire annual development budget debate usually suggests, and it is the clearest dividend of the fiscal consolidation effort.
What changed inside the debt stock
The composition of the debt tells its own story. As of end-June 2026, fixed-rate instruments made up 27 per cent of government securities in the domestic debt portfolio, locking in borrowing costs rather than leaving them exposed to rate swings. The maturity profile was 20 per cent short-term and 80 per cent long-term, giving the government breathing room on refinancing.
On the external side, 60 per cent of external debt was at fixed rates and 40 per cent at floating rates. Separate central bank data shows domestic debt of Rs59,441 billion and external debt of Rs27,274 billion within the public debt total, with the IMF’s outstanding disbursements rising to about $11,050 million by June 2026 under the Extended Fund Facility and the Resilience and Sustainability Facility.
Economists also flag a longer arc: external debt as a share of GDP has fallen from around 28 per cent to roughly 21 per cent over recent years, and average domestic debt maturity has stretched from 2.8 to 3.8 years — both signs that the structure of the borrowing, not just its size, is being managed more carefully.
What Rs91 trillion means for Pakistan
A Rs91 trillion debt stock is a staggering figure, and it will dominate political argument for weeks. But economists assess debt sustainability the way lenders do: by the ratio, the trajectory and the cost of carrying it. By all three measures, FY26 was an improvement — slower growth in the stock, a falling ratio, and a sharply lower interest bill.
The challenge now is keeping that discipline. With the economy growing, interest costs falling and the primary balance in surplus, Pakistan has a rare window to keep shrinking the debt burden in relative terms. Whether that window stays open depends on the fiscal decisions of the year ahead — and on an economy that keeps growing faster than its borrowing.
Related: China and Kuwait roll over $4.3 billion and Saudi Arabia’s $3 billion rollover — both defer repayment rather than reducing the debt.
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