Pakistan’s debt has reached a crushing Rs. 76,045 billion, sounding alarm bells for the economy, according to the latest State Bank of Pakistan (SBP) data. The combined domestic and external debt surged by 12.3% in a single year, rising from Rs. 67,733 billion in May 2024 to Rs. 76,045 billion by May 2025. A 1.5% increase was recorded in just one month, underlining crucial weaknesses in government fiscal policies.

The reports show domestic debt skyrocketed by 15.9% annually, climbing from Rs. 46,125 billion to Rs. 53,460 billion, with a 1.8% rise in May 2025 alone. External debt grew by 4.5% year-on-year, reaching Rs. 22,585 billion from Rs. 21,608 billion, with a 0.8% (Rs. 172 billion) increase in May 2025.

The burden is evident as the debt continues to mount, with annual interest payments on domestic and external loans now exceeding Rs. 7,000 billion, consuming a significant portion of the federal budget. The total debt, interest payments, and government guarantees have hit a historic Rs. 90,000 billion, posing a severe threat to Pakistan’s financial sovereignty.

Economic experts attribute the rapid rise in domestic debt to a consequence of unchecked government spending and lacking fiscal discipline. They warn that without urgent fiscal reforms and reduced reliance on borrowing, Pakistan risks sinking into an unmanageable debt trap in the near future.