Islamabad — Pakistan has taken a historic step in managing its finances by repaying domestic debt ahead of schedule, reflecting a more disciplined and proactive fiscal approach. Over the past 14 months, the government has successfully retired PKR 3,650 billion in domestic loans, easing pressure on public finances.
The State Bank of Pakistan has completed an additional PKR 300 billion in early repayments. Finance Minister Adviser Khurram Shehzad noted that in the first seven months of fiscal year 2026, over PKR 2,150 billion was repaid early — a 44% increase compared to the same period last year.
According to Shehzad, the central bank’s debt has now decreased by nearly 44%, falling from PKR 5,500 billion to around PKR 3,000 billion. Even loans initially due in 2029 have been repaid years ahead of schedule, highlighting the government’s strategic financial planning.
Early repayments included roughly 65% State Bank loans, 30% Treasury Bills, and 5% Pakistan Investment Bonds, bringing total public debt down from PKR 80.5 trillion to nearly PKR 80 trillion.
Shehzad emphasized that the debt-to-GDP ratio has now fallen below 74%, signaling a stronger fiscal position and a more sustainable economic outlook for Pakistan. Analysts say these measures not only reduce financial vulnerability but also demonstrate the government’s commitment to long-term stability and growth.
