Pakistan’s public debt has increased sharply over the past decade. It rose from Rs19.7 trillion at the end of June 2016 to Rs86.7 trillion by the end of June 2026. As a result, the debt stock increased by about Rs67 trillion, or roughly 340%, over 10 years.
The 2016 figure was reported by the State Bank of Pakistan. Meanwhile, the latest figure comes from the government’s Annual Borrowing Plan for fiscal year 2026-27.
The latest debt figure includes both domestic and external public debt. According to the government’s borrowing plan, Rs59.4 trillion of the Rs86.7 trillion total was domestic debt. In addition, Rs27.3 trillion was external debt at the end of June 2026.
How Pakistan’s Debt Has Changed
The increase has come alongside continued government financing needs. It also reflects changes in the composition of borrowing.
In June 2016, the State Bank recorded public debt at Rs19.7 trillion. At that time, it was equal to 66.5% of GDP. According to the central bank, several factors contributed to the increase during FY2016. These included budget deficits, currency-related revaluation losses, higher government deposits and increased IMF borrowing.
More recently, public debt rose from Rs49.3 trillion in June 2022 to Rs86.7 trillion in June 2026. This represents a 76% increase in four years.
However, the government is also taking steps to reduce refinancing risks. It plans to shift more borrowing towards longer-term domestic instruments.
Government Plans More Borrowing in FY2026-27
Meanwhile, the government’s Annual Borrowing Plan projects gross financing needs of Rs28.647 trillion for fiscal year 2026-27. This includes Rs7.02 trillion for the federal fiscal deficit and Rs21.63 trillion for debt maturities.
The government expects to raise around Rs6.046 trillion through net domestic borrowing. At the same time, net external financing is projected at Rs813 billion.
In addition, the borrowing strategy aims to reduce reliance on short-term Treasury bills. The government plans to increase financing through Pakistan Investment Bonds and Sukuk.
The Debt Management Office says the average maturity of public debt improved from 2.7 years in June 2024 to 3.8 years in June 2026. The target is to reach 4.2 years by fiscal year 2028.
The government also reported that interest expenditure declined by 22% during FY2026.
Pakistan’s debt position remains a major fiscal issue. However, authorities are working to extend debt maturities and reduce refinancing pressure. The government’s FY2027 borrowing strategy will influence how the debt stock develops over the coming year.
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