ISLAMABAD: Pakistan has repaid more than Rs3.6 trillion in domestic debt ahead of maturity, marking the country’s largest early debt retirement on record, Finance Ministry adviser Khurram Schehzad said on Thursday.
In a post on X, Schehzad said the Ministry of Finance had early-retired Rs3,654 billion in obligations owed to financial markets and the State Bank of Pakistan since late 2024, including a fresh Rs300 billion payment made this week.
He said the repayments reflect a shift toward tighter fiscal discipline and structured debt management.
According to figures shared by the adviser, early retirements included Rs1 trillion in December 2024, Rs500 billion in June 2025, Rs1.16 trillion in August 2025, Rs200 billion in October 2025, Rs494 billion in December 2025 and Rs300 billion in January 2026.
Schehzad said that during FY2026 alone (July to January), Pakistan retired more than Rs2.15 trillion ahead of schedule – about 44% higher than total early repayments recorded in FY2025.
He added that nearly 44% of SBP-held debt had now been cleared early, cutting the central bank’s domestic debt stock from roughly Rs5.5 trillion to about Rs3 trillion, including liabilities originally due in 2029.
Of the total early repayments, around 65% related to SBP borrowing, 30% to treasury bills and 5% to Pakistan Investment Bonds, helping improve the maturity profile and reduce refinancing risks.
Schehzad said overall public debt declined from above Rs80.5 trillion in June 2025 to about Rs80 trillion by November, while Pakistan’s debt-to-GDP ratio eased from roughly 74% in FY2022 to close to 70%.
He noted that disciplined debt management had lowered borrowing costs, extended average domestic debt maturity from 2.7 years in FY2024 to over four years, and generated significant savings for taxpayers.
The adviser said more than Rs850 billion was saved in FY2025, with an additional Rs800 billion expected in FY2026, driven by early repayments, debt switching and stable interest rates.
He said the move from heavy borrowing toward early repayment and risk reduction represented a structural change in fiscal policy, strengthening economic resilience and creating space for development and social spending.
