Pak’s Debt-to-GDP Ratio Hits 65.7%, Lowest Level Since 2018.

Karachi: Pakistan’s debt-to-GDP ratio declined to 65.7% in September, signaling a reversal in the upward trajectory observed during the last fiscal year, This change represents the lowest level since June 2018, with the domestic debt-to-GDP ratio at 43.1% and the external debt-to-GDP at 22.7%.

According to Zameen.Com, this decrease in the debt-to-GDP ratio reflects a complex landscape influenced by fluctuating borrowing needs, government debt restructuring, and evolving tax challenges. The central government’s total debt in September was PKR 69.6 trillion, marking a month-on-month reduction of 1.1% or PKR 792 billion from August’s figure of PKR 70.4 trillion.

The decline in the debt-to-GDP ratio follows a significant increase in domestic debt over the past year, which surged by PKR 7.838 trillion, reaching PKR 47.536 trillion in September 2024, up from PKR 39.698 trillion in September 2023. However, the rise in domestic debt from June to September 2024 was more modest, with an increase of only PKR 376 billion.

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