KARACHI: Pakistan’s central government debt surged by massive Rs 1.4 trillion in April alone, driven by heavy domestic and external borrowing, underscoring the growing fiscal pressures facing the country’s economy.
The State Bank of Pakistan (SBP) on Tuesday reported a sharp increase in the federal government’s debt burden, with total debt stocks, including domestic and external liabilities, rising by Rs1.406 trillion during April 2026, the tenth month of FY26. As a result, the central government’s total debt stock climbed to an unprecedented Rs81.930 trillion by the end of April 2026, up from Rs80.524 trillion in March 2026.
The increase accounts for nearly 34 percent of the total debt accumulated so far in the current fiscal year (ten months of FY26), highlighting the government’s continued reliance on borrowing to meet its financing requirements.
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The sharp rise in the federal government’s debt burden during April was largely driven by a substantial increase in external debt. According to SBP data, external debt stocks jumped by Rs882 billion in a single month, climbing from Rs22.959 trillion at the end of March 2026 to Rs23.841 trillion by the end of April 2026.
Domestic debt also continued its upward trajectory, although at a comparatively slower pace compared to external debt. The central government’s domestic debt stock increased by Rs523 billion during April, moving from around Rs57.566 trillion in March to Rs58.089 trillion by the end of April 2026.
Analysts noted that until March 2026, external debt had shown a declining trend; however, the sharp increase recorded in April indicates a reversal driven by fresh foreign borrowing during the month, which pushed external debt upward after several months of declining trend.
While, the rise is domestic debt mainly attributed to continued borrowing through government securities and other domestic financing instruments to meet fiscal and budgetary requirements.
The combined increase in both external and domestic liabilities pushed the federal government’s total debt stock to a new record level of Rs 81.930 trillion, reflecting the growing dependence on borrowing to finance expenditures and debt servicing obligations.
Cumulatively, Pakistan’s central government debt stocks significantly rose by 5 percent or Rs 4.042 trillion in the first ten months (July-April) of this fiscal year. The federal government’s total debt stock including domestic and external reached record level of Rs 81.93 trillion in April 2026 compared to Rs 77.888 trillion recorded in June 2025.
On the domestic front, the government’s debt burden increased substantially during the first ten months of FY26, with domestic debt stocks rising by Rs3.617 trillion.
The stock of domestic debt reached Rs58.089 trillion by the end of April 2026, compared to Rs54.472 trillion recorded at the close of FY25 in June 2025.
Meanwhile, external debt posted a more modest increase during the period. The federal government’s external debt rose by Rs423 billion, reaching Rs23.841 trillion at the end of April 2026, up from Rs23.417 trillion in June 2025.
Copyright Business Recorder, 2026
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