Pakistan’s domestic and external debt are two components of its public-debt stock, not labels that by themselves show whether borrowing is affordable or prudent. At end-June 2025, the Ministry of Finance reported total public debt of PKR 80,518 billion: PKR 54,472 billion domestic and PKR 26,047 billion external. The figures describe that date and that measure; other official totals may use different scopes.
What do “domestic debt” and “external debt” mean?
In Pakistan’s public-debt reporting, domestic and external identify components of the government’s public-debt stock. Domestic debt is the domestic-market component; external debt is its external component. These categories help describe where the debt sits and the risks it carries, but they are not, on their own, a measure of its cost, safety or sustainability.
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The Ministry of Finance’s January 2026 Debt Policy Statement cites the Fiscal Responsibility and Debt Limitation Act definition of “Total Public Debt”: debt owed by the federal and provincial governments and serviced out of the consolidated fund, plus debts owed to the International Monetary Fund.
Why official debt totals can differ
The ministry also reports “Total Debt of the Government,” which subtracts federal and provincial government deposits with the banking system from the statutory total. At end-June 2025, total public debt was PKR 80,518 billion, while government debt net of deposits was PKR 73,267 billion. Their debt-to-GDP ratios were 70.7% and 64.3%, respectively. These are different measures, not competing estimates of the same figure.
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What makes up Pakistan’s domestic debt?
The Ministry of Finance groups domestic debt into permanent, floating-rate and unfunded debt. Its end-June 2025 breakdown was:
| Category | Ministry description and examples | End-June 2025 stock |
|---|---|---|
| Permanent debt | Longer than one year; includes Pakistan Investment Bonds (PIBs) and Government Ijarah Sukuks (GIS). | PKR 41,777 billion |
| Floating debt | Shorter-term borrowing, including Market Treasury Bills with 3-, 6- and 12-month tenors. | PKR 8,756 billion |
| Unfunded debt | Raised from non-banking sources, primarily National Savings Schemes administered by the Central Directorate of National Savings. | PKR 3,939 billion |
The three amounts add to PKR 54,472 billion, the ministry’s domestic-debt total for that date. They show the composition at end-June 2025, not a permanent split.
What counts as external debt—and what does not?
External public debt is the external component of public debt. It should not be confused with “external debt and liabilities,” a broader aggregate that includes public and publicly guaranteed debt, public-enterprise debt, private-sector external debt, bank borrowing and intercompany liabilities.
The Ministry of Finance’s January 2026 statement reports external debt of USD 91.8 billion at end-June 2025 and USD 91.4 billion at end-September 2025. Those dollar figures have a stated scope in the ministry’s discussion; do not substitute them for the rupee-denominated external public-debt figures below unless the scope is confirmed to match. In a separate clarification, the ministry described total external debt and liabilities as USD 138 billion and external public debt as approximately USD 92 billion—another example of why the broader aggregate must not be compared directly with public debt alone.
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How large was public debt at the latest reported dates?
The Ministry of Finance’s January 2026 statement gives these public-debt stock figures. All amounts below are in PKR billion and tied to their reference dates.
| Reference date | Total public debt | Domestic debt | External debt |
|---|---|---|---|
| End-June 2025 | 80,518 | 54,472 | 26,047 |
| End-September 2025 | 79,147 | 53,424 | 25,723 |
The figures are reported stocks at two points in time. Do not treat them as a current-day balance or infer a trend beyond those dates. The September table’s rupee-denominated external public-debt row is also distinct from the statement’s USD external-debt figures unless their scopes are confirmed to match.
How do domestic and external debt differ in risk?
Neither category is automatically cheaper or safer. The risk depends on the instruments, their terms, repayment timing and the government’s ability to service them. The Ministry of Finance tracks currency risk, interest-rate risk and maturity separately rather than treating “domestic” or “external” as a complete risk rating.
Currency exposure
Foreign-currency debt can become more expensive in rupee terms when the rupee depreciates. The ministry uses external debt’s share of total public debt as a currency-risk indicator; that share was 32.2% by March 2025. This indicator is dated and does not, by itself, describe the government’s full capacity to manage exchange-rate risk.
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The category label does not tell you the borrowing rate or whether an instrument’s rate is fixed or floating. Those details matter: a fixed-rate instrument and a floating-rate instrument can respond differently to changing market rates. The ministry tracks the fixed-rate share as an interest-rate-risk indicator, so compare instrument terms rather than assuming all domestic or all external borrowing has one rate structure.
Refinancing and maturity
Debt that must be repaid or refinanced sooner creates a different cash-flow challenge from debt with a longer maturity. Compare repayment schedules and maturity profiles—not just headline stock sizes. The ministry reports average time to maturity separately for domestic and external debt.
Interest expense is not an interest-rate comparison
Pakistan’s Economic Survey 2024–25 reports PKR 6,439 billion in public-debt interest expense during July–March FY2025: PKR 5,783 billion domestic and PKR 656 billion external. These are nominal expenses for that reporting period, not comparable interest rates; the totals alone do not show the cost per unit of debt or the terms of each instrument.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.How to read a Pakistan debt figure
Before comparing two numbers, check four things:
- Measure: Is it total public debt, government debt net of deposits, external public debt, or total external debt and liabilities?
- Date: Is the figure a stock at a stated month-end, or an expense over a stated period?
- Unit: Is it reported in PKR or USD? Do not compare currencies without a stated conversion and matching scope.
- Composition and terms: Which instruments, currencies, rates and maturities are included?
The Ministry of Finance frames debt management as balancing costs and risks: “it is important to have an effective debt management strategy to minimize the costs of meeting the government’s borrowing needs, while taking into account the associated risks by ensuring an optimum combination of debt composition.”
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