The total public debt stock of Pakistan’s federal government saw a 10 percent increase year-on-year in August 2024, reaching Rs. 70.362 trillion, up from Rs. 63.970 trillion in August 2023, according to the latest data from the State Bank of Pakistan (SBP).
On a month-to-month basis, the public debt rose by 1 percent, climbing from Rs. 69.623 trillion in July 2024. The data reveals a significant rise in the domestic debt of the central government, which surged by 21 percent from Rs. 39.795 trillion in August 2023 to Rs. 48.339 trillion in August 2024.
Breaking down the domestic debt, long-term public debt increased from Rs. 30.013 trillion to Rs. 37.298 trillion, while short-term debt rose from Rs. 9.636 trillion to Rs. 10.961 trillion over the past year.
Topline Securities, a brokerage firm, noted that the central government’s debt-to-GDP ratio decreased to 65 percent in August 2024 from 73 percent in August 2023. This reduction is largely attributed to a decline in the external debt-to-GDP ratio, which fell from 27.6 percent to 20.2 percent over the same period.
The decline in the external debt-to-GDP ratio is primarily due to the appreciation of the Pakistani rupee against the US dollar, with the exchange rate improving from PKR/USD 305.61 in August 2023 to 278.57 in August 2024. This currency appreciation has played a crucial role in easing the external debt burden relative to the country’s GDP.
