In a major fiscal move, Pakistan has announced the early retirement of PKR 500 billion in sovereign debt owed to the State Bank of Pakistan, originally set to mature in 2029. This comes just months after a historic PKR 1 trillion market debt buyback in December 2024 bringing total early repayments in FY25 to PKR 1.5 trillion.
Officials report significant economic gains: Pakistan’s debt-to-GDP ratio has declined to 69%, the average maturity of public debt has increased to 3.75 years, and interest cost savings are estimated at PKR 830 billion this fiscal year.
Economic advisor Khurram Schehzad called it “a decisive and disciplined strategy” to strengthen macroeconomic stability. Analysts believe this step will bolster investor confidence, enhance fiscal resilience, and mark a new era of forward-thinking public debt management in Pakistan.
