Pakistan’s central government debt reached Rs 78.2 trillion in July 2025, marking a rise of Rs 350 billion from June 2025, according to data released by the State Bank of Pakistan (SBP). This increase continues the upward trajectory of the country’s debt burden.
The total debt, comprising both domestic and external borrowings, grew by 0.45% month-on-month (MoM), up from Rs 77.888 trillion in June 2025. On a year-on-year (YoY) basis, the debt has risen by 12.4%, up from Rs 69.623 trillion in July 2024.
The breakdown of debt shows a notable increase in domestic borrowings, which grew by 15.2% YoY and 1% MoM, reaching Rs 54.9 trillion in July 2025. In comparison, domestic debt stood at Rs 47.716 trillion in July 2024 and Rs 54.471 trillion in June 2025.
Meanwhile, external debt saw slower growth, rising by 6.1% YoY but declining by 0.7% MoM to stand at Rs 23.3 trillion by the end of July 2025. This decline in external debt is largely attributed to fluctuations in the exchange rate, which affects the local currency value of foreign-denominated borrowings. The exchange rate for the US dollar in July 2025 was Rs 282.85, slightly lower than Rs 283.75 in June 2025.
The SBP also reported a significant profit for the fiscal year 2025 (FY25), with Rs 2.4 trillion of the profit being transferred to the federal government. This transfer helped reduce net budgetary borrowing from the banking system while increasing credit to the non-government sector.
For the fiscal year 2026 (FY26), the government is targeting a primary surplus of 2.4% of GDP as part of its broader fiscal consolidation efforts. Achieving this goal will depend on effective revenue collection and expenditure rationalization strategies.
