Finance Ministry dismisses claims of Rs20 billion daily rise in government debt

ISLAMABAD: The Ministry of Finance has dismissed reports claiming that Pakistan’s government debt is rising by Rs20 billion per day, stating that the figures do not accurately reflect the country’s overall debt position.

In its clarification, the ministry said public debt should be evaluated in relation to gross domestic product (GDP), rather than through daily borrowing figures alone.

According to the ministry, Pakistan’s debt-to-GDP ratio has dropped from 75 per cent to below 68 per cent, while the debt growth rate has slowed from 26 per cent to 7.7 per cent.

The ministry stated that the debt growth rate in fiscal year 2026 was the lowest in two decades. It added that the average annual debt growth rate stood at 16.7 per cent between fiscal years 2007 and 2026.

The ministry further reported that central government debt decreased by Rs689 billion in August 2026.

It also said Pakistan’s external debt-to-GDP ratio had declined from 33 per cent to 23 per cent.

According to the ministry, external debt rose by an average of $1.7 billion annually between fiscal years 2022 and 2026, compared with an average annual increase of $6.4 billion from 2015 to 2022.

The ministry maintained that these figures demonstrate a slowdown in the pace of debt accumulation and a decline in the country’s debt ratios.