Pakistan’s federal debt has crossed Rs 70 trillion, mainly due to heavy borrowing to cover the country’s fiscal deficit, as reported by the State Bank of Pakistan (SBP). In the first two months of the fiscal year 2024-25, the government’s debt grew by 2.1%, reaching Rs 70.362 trillion, which is an increase of Rs 1.448 trillion.
Most of this increase came from a sharp rise in domestic debt, which went up by Rs 1.179 trillion, bringing the total domestic debt to Rs 48.34 trillion.
On the other hand, external debt saw a smaller rise of 1.2%, reaching Rs 22.023 trillion. This increase in external debt was helped by a slight improvement in the value of the Pakistani rupee.
The rapid increase in both domestic and external debt points to the challenges the government faces in maintaining the country’s fiscal stability, as spending continues to rise while revenue collection remains slow. Managing this growing debt is crucial for Pakistan’s economic health and sustainability.
