The federal government has unveiled a borrowing plan worth approximately Rs6.4 trillion for fiscal year 2025-26 to manage total public debt of Rs81.5 trillion as of June 30, 2025, amid an ongoing International Monetary Fund (IMF) review of Pakistan’s fiscal and monetary performance.
According to the Ministry of Finance, the net domestic borrowing is projected at Rs6.395 trillion under the Annual Borrowing Plan FY26, prepared in line with the Medium-Term Debt Management Strategy (MTDS) 2026-28 and the FY26 budget framework.Â
The plan aims to fund a federal fiscal deficit estimated at Rs6.5 trillion, with annual interest expenditure projected at Rs8.207 trillion and a planned primary surplus of Rs1.706 trillion. Domestic interest costs are set at Rs7.2 trillion, while external debt servicing is estimated at Rs1.009 trillion.
The borrowing strategy prioritises domestic sources through quarterly auction calendars and emphasizes long-term fixed-rate instruments, including Pakistan Investment Bonds worth Rs4.336 trillion and Sukuks of Rs1.895 trillion.
 Zero-coupon bonds and Shariah-compliant instruments will be expanded to diversify the investor base, with structures such as Ijarah, Wakalah, and Murabaha being explored. Plans for Asset Light Sukuk (ALS) and development of a Shariah-compliant yield curve are also under consideration.
Net external financing is projected at $364 million (Rs106 billion), with the plan focusing on $1.9 billion from multilateral loans, $4 billion in bilateral deposit rollovers from China, $5 billion from Saudi Arabia, and $400 million through Panda and Sustainable Bonds. Eurobond maturities of $1.8 billion will also be repaid.
The ministry projected Gross Financing Needs at 21 percent of GDP for FY26, reflecting fiscal consolidation efforts that are expected to reduce the deficit and lower debt service requirements. Total public debt at the end of June 2025 stood at Rs80.5 trillion, comprising Rs54.5 trillion in domestic debt and Rs26 trillion in external debt.
