Pakistan has retired more than Rs4.7 trillion in public debt before its scheduled maturity through a series of buyback operations, in what the government says is the country’s biggest debt management exercise to date.
Finance Minister’s adviser Khurram Schehzad said the latest buyback of Pakistan Investment Bonds worth Rs279 billion pushed the total value of early debt retirement to Rs4.722 trillion.
In a post on X on Tuesday, Schehzad said the programme represented the largest and longest-running liability management effort in Pakistan’s history. He said the strategy was designed to improve the government’s debt profile instead of simply making routine repayments.
According to figures shared by the adviser, Pakistan retired Rs2.9 trillion in debt ahead of schedule during fiscal year 2025-26, a 62 percent increase from Rs1.8 trillion in the previous year. Around 51 percent of the retired amount was central bank debt, while the remaining 49 percent was market debt.
Schehzad said the buyback programme is helping the government reduce refinancing and rollover risks, cut debt servicing costs, manage cash flow more efficiently and strengthen investor confidence.
He added that Pakistan’s debt profile has improved in recent years. The average maturity of government debt has increased from 2.7 years in FY24 to more than 3.8 years in FY26, giving the government a longer repayment horizon.
The adviser also said the country’s debt to GDP ratio has fallen from 75 percent in FY23 to around 68.5 percent in FY26. At the same time, reliance on borrowing from the central bank has been reduced significantly.
The buyback operations were carried out in several phases starting in October 2024 and continued through multiple transactions before the latest Rs279 billion operation.
Schehzad said the debt management plan is part of wider economic reforms aimed at improving public finances, easing financial risks, reducing borrowing costs and supporting long term fiscal stability while strengthening the country’s overall economic position.
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