Pakistan’s debt profile ‘alarming’, borrowing and spending habits ‘unsustainable’: report

A report by Islamabad-based think tank Tabadlab has stated that Pakistan’s debt profile is “alarming” while the country’s borrowing and spending habits were “unsustainable”. The 68-page report, titled ‘A raging fire: Pakistan’s debt crisis’, was released on Sunday. It said that the country’s total debt and liabilities — including domestic and external debt — to be at Rs77.66 trillion, or $271.2 billion. The report said that Pakistan’s external debt was primarily borrowed from a range of creditors: Paris club (6.3 per cent), multilaterals (30.1pc), other bilateral (19.1pc), commercial banks and T-bills (4.9pc), Eurobonds (6.3pc), the International Monetary Fund (5.7pc), banks (5.1pc) and private sector liabilities (12.7pc). It noted that Pakistan’s debt per capita had also grown from $823 in 2011 to $1,122 in 2023, a 36pc increase in 12 years. At the same time, the country’s gross domestic product (GDP) per capita had declined from $1,295 in 2011 to $1,223 in 2023, a 6pc decrease. It stated that this meant that the country’s debt was growing “at a much larger pace than its income, widening financing gaps [and] necessitating further borrowing”.