Pakistan’s central government debt has recorded its slowest growth in 15 years, with year-to-date expansion in FY26 standing at just 5%, compared with 23% in FY23, according to Finance Adviser Khurram Schehzad.
Commenting on the latest figures released by the State Bank of Pakistan, Schehzad said comparisons based solely on the total amount of debt were misleading. Writing on social media platform X, he stressed that sovereign debt should be judged by its sustainability rather than by absolute numbers.
He clarified that Pakistan’s central government debt currently stands at Rs81.9 trillion. The higher figure of Rs97–100 trillion circulating on social media includes total debt and liabilities, such as private sector obligations, and does not represent central government debt alone.
Schehzad said the internationally accepted benchmark for assessing public debt is the debt-to-GDP ratio. According to him, Pakistan’s debt-to-GDP ratio has declined from around 76% in FY2019-20 to nearly 68% in FY26. He added that external debt has also fallen from about 28% of GDP to around 21%, reducing the country’s external repayment risks.
He also highlighted improvements in debt management, noting that the average maturity of domestic debt has increased from 2.8 years to 3.8 years, lowering refinancing risks. In addition, Pakistan has retired Rs4.7 trillion in debt, which he described as a historic achievement.
Schehzad said all governments borrow, repay and refinance debt, but the key measure is whether debt becomes more sustainable, affordable and less risky. He maintained that recent indicators show Pakistan is moving in that direction.
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