Pakistan’s Federal government debt increased by 0.7 percent on a month on month basis in November 2025, reaching Rs. 77.5 trillion according to data released by State Bank of Pakistan and compiled by Topline Securities.
The rise was driven mainly by an increase in domestic borrowing. Central government domestic debt stood at Rs. 54.6 trillion in November, up 1.2 percent compared to October and 12.4 percent higher than a year earlier.
In contrast, external debt declined 0.3 percent month on month to Rs. 22.9 trillion, helping partially offset the increase in local liabilities.
On a cumulative basis, government debt actually declined during the July to November period. SBP data shows that total central government debt fell by Rs. 345 billion, or 0.44 percent, from Rs. 77.9 trillion at the end of June to Rs. 77.5 trillion by November, reflecting restrained borrowing and improved fiscal inflows.
Analysts attributed the moderation primarily to a fall in external debt. According to market participants, foreign debt declined partly due to rupee appreciation and partly because of $790 million in external debt repayments during the period.
The rupee strengthened from 283.74 per dollar at the end of June to 280.46 per dollar by the end of November, easing the local currency value of foreign obligations.
In dollar terms, central government external debt declined to $81.7 billion in November 2025, compared to $81.9 billion in October and $82.5 billion in June, according to Topline’s analysis based on SBP figures. On a year on year basis, however, external debt remained 5.25 percent higher than November 2024.
Domestic debt trends show a steady upward bias. SBP figures indicate that domestic debt increased by Rs. 147 billion during the first five months of the fiscal year and rose over 12 percent year on year, underscoring the government’s continued reliance on local banks to finance the budget deficit.
Analysts noted that government borrowing has crossed 100 percent of the banking sector’s deposit base, highlighting the deep interlinkages between the state, commercial banks, and the central bank.
With deposit growth remaining subdued, banks have continued to rely on SBP liquidity injections through open market operations to meet government financing needs.
Public debt stood at around 70 percent of GDP in June 2025, showing some moderation from recent peaks, with domestic debt accounting for roughly 68 percent of total public debt, according to market assessments.
As long as form 47 govt will stay in power bad debt will keep on increasing, as they do not have any strategy to impeove the economy., they are it is bound to follow planters orders.