Pakistan’s per capita debt increased by 13 percent during the last fiscal year, reaching Rs. 333,000 per person, according to the Fiscal Policy Statement presented in Parliament.
The report shows a worrying rise in the country’s overall debt burden and growing pressure on public finances.
Total public debt rose sharply from Rs. 71.2 trillion to Rs80.5 trillion within one year. As a result, public debt reached 70.7 percent of the country’s Gross Domestic Product (GDP).
The main reasons behind this increase were high interest payments on existing loans and pressure from the weakening exchange rate, which made foreign debt more expensive to manage.
The statement also revealed that the federal fiscal deficit crossed the legal limit set under fiscal responsibility laws.
The deficit reached 6.2 percent of GDP, much higher than the allowed limit of 3.5 percent. This indicates that government spending continued to exceed income by a wide margin, adding further stress to the economy.
On the revenue side, the government performed better in collecting non-tax revenues. Income from sources such as profits of state-owned enterprises, fees, and other charges exceeded the original targets.
However, tax collection remained below expectations. This shortfall in taxes limited the government’s ability to control the deficit and reduce borrowing needs.
Experts warn that rising debt and weak tax performance could create long-term economic challenges if not addressed through reforms.
They stress the need for better tax administration, controlled spending, and policies that support economic growth. The government has acknowledged these challenges and emphasized the importance of fiscal discipline to stabilize the economy and reduce the debt burden on future generations.
