ISLAMABAD: The Ministry of Finance has retired more than PKR 1.1 trillion in debt held with the State Bank of Pakistan (SBP), reducing SBP-held government debt by approximately 30% in less than two months.
The total government debt with the SBP, initially PKR 5.5 trillion, now stands at PKR 3.8 trillion, reflecting a key step in fiscal management and debt reduction. The repayment is part of a broader strategy aimed at strengthening financial stability and addressing long-term economic challenges.
The move significantly mitigates concentration risk, as a large portion of the debt was previously scheduled to mature on a single day in June 2029, raising concerns over a potential liquidity bottleneck. By reducing the debt, the government has spread out the maturity schedule, lowering the risk of a sudden financial crisis.
The repayment is expected to enhance investor confidence in Pakistan’s economy and improve the government’s ability to manage debt obligations more effectively in the future.
