ISLAMABAD: The government repaid Rs1.541 trillion in commercial bank debt during the first half of FY25, according to State Bank of Pakistan (SBP) data released on Tuesday.
This represents a sharp contrast to the Rs3.74 trillion net borrowing in the same period last year, reflecting a clear shift in fiscal strategy.
The SBP noted that from July 1 to January 3, the government transitioned to a net debt-retiring position after years of consistent borrowing. This shift was supported by liquidity injections of Rs2.7 trillion from the SBP in FY24, largely driven by gains from high interest rates and exchange rate fluctuations.
Last fiscal year, the SBP reported a record profit of Rs3.42 trillion as the policy rate remained at 22%, a level that significantly increased bthe government’s borrowing costs During FY24, the federal government borrowed Rs8.519 trillion, primarily at rates above 20%.
