Pakistan’s federal government sharply increased its borrowing from domestic banks during the middle of June, securing approximately Rs. 611 billion within just five working days, from June 15 to June 19.
According to data released by the State Bank of Pakistan (SBP), this translates to an average borrowing rate of nearly Rs. 122 billion per day, reflecting the government’s continued dependence on local financial institutions to meet its funding requirements.
The latest borrowing has pushed the government’s total domestic borrowing for the current fiscal year to around Rs. 5.529 trillion, already surpassing the Rs. 5.434 trillion borrowed during the entire previous fiscal year (FY25).
The figures indicate that borrowing has continued at a rapid pace despite efforts to manage public finances and maintain fiscal stability.
Economists say the rising level of domestic borrowing highlights the growing fiscal challenges facing the country. A significant share of government revenues is being directed toward debt servicing, leaving limited room for development and public spending.
The trend also means commercial banks continue allocating a substantial portion of their funds to government securities, reducing the availability of credit for private businesses and investment, which could have implications for economic growth and job creation in the months ahead.
