Largest single domestic debt repayment so far: Govt retires Rs1.2trn to SBP ahead of schedule
Pakistan's government made its largest single early domestic debt repayment of Rs1.2 trillion to the SBP, bringing the total to over Rs5.92 trillion, reflecting proactive debt management.
- Largest single early domestic debt repayment.
- Cumulative domestic debt retired ahead of maturity.
- Government's strategy for proactive debt management.
ISLAMABAD: The government has retired Rs1.2 trillion in domestic debt owed to the State Bank of Pakistan (SBP) ahead of its scheduled maturity, marking the largest single early repayment tranche undertaken so far, according to Khurram Schehzad, Adviser to the Finance Minister.
Schehzad said the latest repayment takes the cumulative domestic debt retired before maturity to more than Rs5.92 trillion.
He said the latest early repayment surpassed the previous record of Rs1.133 trillion made in August 2025, underscoring the government’s increasing focus on proactive public debt management.
According to details shared by the adviser, Pakistan has retired domestic debt ahead of maturity in a series of repayments since October 2024.
These include Rs826 billion in October 2024, Rs200 billion in November 2024, Rs273 billion in March 2025, Rs500 billion in June 2025, and Rs1.133 trillion in August 2025.
Further early repayments included Rs122 billion in November 2025, Rs494 billion in December 2025, Rs300 billion in January 2026, Rs595 billion in April 2026, Rs279 billion in May 2026 and Rs1.2 trillion in August 2026.
READ ALSO: Pakistan retires record Rs1.2tn domestic debt ahead of maturity: Khurram Schehzad
Schehzad said the pace of early debt retirement had also accelerated significantly, with Rs1.8 trillion retired ahead of maturity during FY2025, followed by Rs2.9 trillion in FY2026—an increase of around 62 percent.
Another Rs1.2 trillion has already been retired ahead of maturity in FY2027, he added.
He said the development reflected a fundamental shift towards active sovereign liability management, whereby improved fiscal space was being used to retire obligations before maturity.
According to Schehzad, the strategy would help reduce refinancing and rollover risks, lower future debt-servicing pressures and strengthen Pakistan’s overall public debt profile. He said Pakistan was increasingly moving beyond simply managing debt maturities towards actively strengthening its sovereign balance sheet.
Copyright Business Recorder, 2026
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