Debt burden surges to record high of Rs81.2 trillion

Pakistan’s total debt and liabilities have peaked at Rs81.2 trillion – a figure that grew at a faster pace of over 27% during the past year, posing emergent management challenges to the newly elected government. The bulletin released by the State Bank of Pakistan (SBP) on Monday showed that the country’s total debt and liabilities increased by another Rs17.4 trillion as of the end of December compared to the previous year. The total debt and liabilities now stand at Rs81.2 trillion, including Rs4.6 trillion in liabilities. The government accumulated debt at a rate of 27.2%, averaging Rs48 billion per day since December 2022. This is one of the highest monthly increases in public debt, which includes five months of the caretaker government. Managing public debt and the growing cost of interest payments will be one of the paramount challenges for the newly elected government and may require tough decisions. However, a visibly weak coalition government may find such choices hard, particularly when there are ideological differences among potential coalition partners.