By Moaaz Manzoor

Pakistan’s central government debt rose slightly to Rs81.949 trillion by the end of May 2026, with the latest increase largely reflecting higher domestic borrowing through short-term instruments, according to the latest data of the State Bank of Pakistan.

The SBP data on Central Government Debt, available up to May 31, 2026, shows that total central government debt stood at Rs81,949.46 billion in May compared with Rs81,930.06 billion in April, an increase of Rs19.40 billion during the month. Since December 2025, the stock has increased by Rs3,420.73 billion from Rs78,528.73 billion.

The figures are reported by the SBP in billion rupees. The total central government debt includes both domestic and external debt of the federal government.

Domestic debt remained the largest component, rising to Rs58,107.04 billion in May from Rs58,088.80 billion in April. Compared with December 2025, domestic debt increased by Rs2,744.22 billion from Rs55,362.82 billion.

The composition of domestic debt shows a continued reliance on short-term borrowing. Short-term domestic debt increased to Rs10,733.82 billion in May from Rs10,556.65 billion in April. This was mainly driven by market treasury bills, which rose to Rs10,608.54 billion from Rs10,432.03 billion during the month.

In contrast, long-term domestic debt declined to Rs47,297.16 billion in May from Rs47,472.06 billion in April. Permanent debt also fell to Rs43,647.08 billion from Rs43,845.38 billion.

Federal government bonds, the largest component of permanent debt, declined to Rs42,738.28 billion in May from Rs42,938.28 billion in April. Within this category, Pakistan Investment Bonds fell to Rs34,644.79 billion from Rs35,034.62 billion, while GOP Ijara Sukuk increased to Rs7,462.91 billion from Rs7,273.07 billion.

Unfunded debt increased to Rs3,255.68 billion in May from Rs3,235.78 billion in April. Within this, saving schemes, net of prize bonds, rose to Rs3,188.08 billion from Rs3,171.38 billion. Prize bonds also edged up to Rs431.02 billion from Rs429.32 billion.

Naya Pakistan Certificates increased to Rs76.06 billion in May from Rs60.09 billion in April, while foreign currency loans under domestic debt rose to Rs394.40 billion from Rs390.90 billion.

Central government external debt was almost unchanged on a month-on-month basis, standing at Rs23,842.41 billion in May compared with Rs23,841.26 billion in April. However, its internal composition shifted during the month. Long-term external debt increased to Rs21,150.03 billion from Rs19,728.92 billion, while short-term external debt declined to Rs2,692.39 billion from Rs4,112.34 billion.

The latest debt profile shows that while the overall central government debt rose only marginally in May, the structure of domestic borrowing remained a key concern. A rise in market treasury bills points to higher reliance on short-term instruments, while the decline in Pakistan Investment Bonds reflects a pullback from longer-term domestic borrowing.

For fiscal management, the composition is important because short-term debt generally requires more frequent refinancing, making the government more exposed to rollover and interest-rate conditions. The latest SBP data therefore points not only to the size of the debt stock, but also to the changing mix between short-term and long-term liabilities.

Credit: INP-WealthPk