Pakistan earmarks Rs8.054 trillion for debt servicing in FY27

Pakistan has allocated Rs8.054 trillion for debt servicing in fiscal year 2026-27, equivalent to 42.9% of the federal budget’s total outlay of Rs18.771 trillion. The allocation covers interest payments and repayment of principal on domestic and foreign debt.

The FY27 provision is lower than the Rs8.207 trillion originally budgeted for the outgoing fiscal year. However, the FY26 estimate was subsequently revised down to Rs6.937 trillion.

Of the total allocation for next year, Rs6.982 trillion has been earmarked for domestic debt servicing.

The government had initially allocated Rs7.197 trillion for domestic debt payments in FY26 before revising the amount to Rs6.006 trillion.

Foreign debt servicing is projected to increase to Rs1.071 trillion in FY27.

This compares with an original allocation of Rs1.009 trillion for the current fiscal year, which was later revised down to Rs930.918 billion.

Meanwhile, Pakistan’s total public debt reached Rs83.285 trillion by the end of March 2026, increasing by Rs2.767 trillion, or approximately 3.4%, during the first nine months of FY26.

The country’s public debt stood at Rs80.518 trillion on June 30, 2025.