Understanding Pakistan’s Public Debt: A Closer Look
Last month, Prime Minister Imran and his finance team made headlines by confirming that Pakistan’s public debt remained at a staggering Rs36.4 trillion between July and October. But what’s really going on with our economy? If you’re scratching your head, you’re not alone. As citizens, it’s important to grasp how this impacts us all.
Pakistan’s total public debt is an astonishing Rs17 trillion above the statutory limit set by Parliament, which is intended to keep our finances in check. To give you some perspective, public debt reached 70.7% of our Gross Domestic Product (GDP), far beyond the maximum 56% allowed. This matter was highlighted in the Debt Policy Statement 2026, crafted for Parliament as part of the Fiscal Responsibility and Debt Limitation Act (FRDLA).
So, why should you care? Well, these unsustainable debt levels eat up a staggering half of our annual budget, making it tough for the government to invest in crucial sectors like education and healthcare. The weight of this debt falls heavily on the ordinary citizens—most of us—who are already navigating various financial challenges.
Adding to the pressure, the Federal Board of Revenue (FBR) has been struggling to meet its revised tax targets. The board collected Rs7.174 trillion during the July-January period, but that wasn’t enough; they missed their target by Rs347 billion. With such a dip in revenue, you have to wonder: where does that leave us?
In efforts to tackle this ongoing crisis, the Ministry of Finance assured Parliament that they’re committed to reducing public debt to more sustainable levels. They’ve got a plan involving fiscal consolidation, generating primary surpluses, and narrowing the fiscal deficit. But as we know, effective implementation is key.
The government has even outlined a new debt management strategy focusing on reducing refinancing risks. They’re extending the maturity of domestic loans and diversifying their sources of funding, which is crucial for long-term health. As of June 2025, the maturity of domestic government securities increased, indicating a strategic shift to more stable financial solutions.
However, while external loans and domestic debt are being managed, the overall public debt is still rising, now at Rs80 trillion. With international institutions like the IMF becoming significant stakeholders, we must remain vigilant about how these relationships impact future financial policies.
In summary, Pakistan’s public debt situation is a complex but critical issue for us all. As citizens, it’s worthwhile to stay informed and engaged with these developments. If you’re interested in understanding more about financial literacy and navigating these economic waters, resources like Pro21st offer valuable insights and community support.
Staying connected to reliable information sources helps us all make informed decisions, both personally and as a community.
