Pakistan retires Rs4.72 trillion debt ahead of schedule in record liability management operation

Pakistan has repaid Rs4. 722 trillion in public debt ahead of schedule in what the government describes as the largest liability management operation in the country’s history, Finance Adviser Khurram Shahzad announced on Tuesday. According to Shahzad, the early repayment total reached Rs4. 722 trillion following the recent buyback of Pakistan Investment Bonds (PIBs) worth Rs1 trillion. He said that during fiscal year 2025-26, the government retired Rs2. 9 trillion in debt before its scheduled maturity, marking the first time Pakistan has undertaken such a large-scale early debt repayment programme. The finance adviser said the move would help lower borrowing costs and reduce rollover risk, while improving the country’s overall debt profile. Shahzad noted that Pakistan’s average debt maturity period has increased from 2. 7 years to more than 3. 8 years, reflecting what he described as more effective debt management. He also said the country’s debt-to-GDP ratio has declined from 75 per cent to around 68. 5 per cent, while dependence on borrowing from the State Bank of Pakistan has been significantly reduced. According to the finance adviser, the government’s active debt management strategy is strengthening investor confidence and enhancing financial stability. He said the early retirement of debt represents the largest liability management operation in Pakistan’s history and forms part of the government’s broader efforts to promote fiscal discipline and build a more stable and sustainable economy.

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