External debt increases 83% in 10 months of fiscal year 26

ISLAMABAD:

Pakistan borrowed nearly $11 billion in external loans during the first 10 months of the current fiscal year 2025-26, an increase of 83 percent compared to the same period of the previous fiscal year, according to official data released by the Economic Affairs Division (EAD).

The figures show the federal government borrowed $11 billion in foreign loans and financing between July 2025 and April 2026, compared with nearly $6 billion borrowed during the corresponding period last year.

The government has projected total external financing of $19.39 billion for the current fiscal year, with additional borrowing expected during May and June.

According to EAD statistics, Pakistan received $4.5 billion in April alone, reflecting a sharp rise in external inflows.

The government also received grants worth $120 million during the July-April period. In local currency terms, the government has so far raised Rs 3.103 trillion in external financing during the current fiscal year.

The data further showed that Pakistan received almost $5 billion more in loans than the previous year.

During April of the last fiscal year, total external assistance amounted to $570 million, meaning that April 2026 alone saw a seven-fold increase in external borrowing compared to the same month last year.

The figures do not include financing received from the International Monetary Fund, which exceeded $2.5 billion separately.

Of the total loans during the 10-month period, non-project aid amounted to $8.31 billion, while project-related financing amounted to $2.756 billion.

Of non-project assistance, budget support represented $4,586 million.

Saudi Arabia extended an oil line worth $1 billion to Pakistan under deferred payment agreements, while the Islamic Development Bank provided loans worth $480 million. Grants worth $21.8 million were also received during April.