Pakistan’s debt and liabilities hit Rs98.881 trillion as servicing costs jump 33.27%

Pakistan’s total debt and liabilities reached Rs98.881 trillion at the end of September 2026, up 6.46% from Rs92.879 trillion a year earlier, according to State Bank of Pakistan (SBP) figures released on Friday. Government domestic borrowing and external debt drove the rise, although liabilities declined.

Total debt increased by Rs6.931 trillion, or 7.69%, to Rs97.038 trillion from Rs90.107 trillion in September 2025. Gross government domestic debt reached Rs57.758 trillion against Rs53.427 trillion, while public sector enterprises’ domestic debt climbed to Rs2.084 trillion from Rs2.009 trillion.

External debt grew by Rs2.526 trillion, or 7.29%, to Rs37.197 trillion from Rs34.671 trillion. Government external debt rose to Rs24.900 trillion from Rs23.181 trillion, and non-government external debt increased to Rs7.747 trillion from Rs7.387 trillion.

Debt owed to the International Monetary Fund (IMF) reached Rs3.010 trillion, against Rs2.542 trillion. Intercompany external borrowing from direct investors abroad fell to Rs1.539 trillion from Rs1.561 trillion.

Total liabilities dropped to Rs3.413 trillion in September 2026 from Rs4.436 trillion a year earlier. External liabilities decreased to Rs2.434 trillion from Rs3.378 trillion, while domestic liabilities fell to Rs979 billion from Rs1.059 trillion.

Servicing debt and liabilities cost Rs2.900 trillion in July–September FY27, the first quarter, compared with Rs2.176 trillion in the corresponding FY26 quarter. The Rs724 billion increase, equivalent to 33.27%, reflected larger external principal repayments and higher debt interest payments.

AKD Securities Director Research Mohammed Awais Ashraf said government debt had increased over the year to finance the fiscal deficit, but declined during the first quarter as the authorities recorded a fiscal surplus. He welcomed lower liabilities on the domestic and external fronts and said servicing spending rose 33% because both local and foreign debt costs increased.

External debt and liabilities principal repayments reached Rs1.180 trillion in July–September FY27, against Rs634 billion a year earlier. Government repayments increased to Rs653 billion from Rs479 billion, non-government external debt repayments rose to Rs467 billion from Rs95 billion, and IMF repayments stayed at Rs60 billion.

Ashraf said careful spending and stronger tax revenue growth were improving Pakistan’s debt-to-GDP ratio. Interest on debt nevertheless increased by Rs217 billion, or 14.70%, to Rs1.693 trillion from Rs1.476 trillion.

Interest on gross government domestic debt rose to Rs1.388 trillion from Rs1.176 trillion; external debt interest reached Rs305 billion against Rs300 billion. Interest on liabilities fell to Rs28 billion from Rs65 billion: external liabilities accounted for Rs2 billion against Rs37 billion, and domestic liabilities for Rs26 billion against Rs28 billion.