NEW DELHI, Oct 25: Pakistan’s public debt reached $286 billion by FY25, rising 13% from the previous year and deemed “unsustainable,” according to a Maldives Insight report.
The debt-to-GDP ratio climbed to 70%, while the fiscal deficit stood at $25.2 billion, largely financed through domestic borrowing.
Domestic debt accounts for $194 billion, up 15%, and external debt rose to $92.5 billion. Interest payments increased 9% year-on-year, limiting development spending. Multilateral loans make up 57% of external debt, bilateral loans 26%, and commercial borrowing the rest.
The report highlighted Pakistan’s economy struggles to outpace liabilities, with debt servicing taking precedence over growth. Despite a seemingly manageable debt profile, the economy remains fragile, reliant on external bailouts and domestic credit, exposing deep structural fiscal weaknesses. (IANS)
