National debt of Pakistan

In 2008 when Pakistan Peoples Party (PPP) had won the election, Pakistan's debt was Rs. 6,435 billion which increased by 135% in the next five years of PPP tenure, and became Rs. 15,096 billion in 2013.[2] Majority of this increase in debt was in domestic debt in which external debt of Pakistan increased by 22 percent, from US$42.8 billion in 2008 to US$52.4 billion in 2013.[2] PPP government was dependent on domestic and International lending to meet the needs of the government expenditures.[2] Total debt increased to 64 percent of the GDP but external debt as a percentage of GDP decreased from 29.5 percent to 23.4 percent.[2]

After 2013 Pakistani general election, Nawaz Sharif came to power. During their rule of five years, Pakistan's external debt increased from US$52.4 billion to US$75.3 billion, an increase of 226.80 percent, mainly due to the China-Pakistan Economic Corridor, for which loans were taken from China and all contracts awarded only to Chinese companies, the consequent high imports from China (not offset by any significant exports to China), and also Sukuk bonds.[2]

After 2018 Pakistani general election, Imran Khan came to power. During his rule of 3 years still today Pakistani external debt increased from US$75.3 billion to US$110.6 billion an increase of 35.3 billion USD.[3]

According to a report by the International Monetary Fund, Pakistani owes China 30% of its $100 billion foreign debt.[4]

As of October 2021, Total Public Debt and Liabilities of Pakistan is estimated to be about Rs. 63.279 trillion/US$140 billion which is 89 percent of gross domestic product (GDP) of Pakistan.[5] About Rs. 24.309 trillion is owed by the government to domestic creditors, and about Rs. 2.3 trillion is owed by Public Sector Enterprises (PSEs).[5]

Similarly, as of October 2021, external Debt of Pakistan is now around US$121.75 billion.[5] Pakistan owes US$11.3 billion to Paris Club, US$33.1 billion to multilateral donors, US$7.4 billion to International Monetary Fund, and US$12 billion to international bonds such as Eurobond, and sukuk.[5] About 15% of the external debt which is estimated around US$17.1 billion (6.15% of GDP) is owed to China due to China-Pakistan Economic Corridor.[6]

Pakistan is facing a "huge external financing gap" of $4 billion, with China, Saudi Arabia, and the UAE expected to provide additional support. The IMF is seeking to fund its program and secure $7 billion for debt repayment, current account deficit financing, and increasing foreign exchange reserves. The talks between Pakistan and the IMF were delayed due to concerns over the credibility of the government's assurances and the reliability of foreign loans. Despite some agreement on reform actions and measures, there are still outstanding issues and the IMF has expressed concerns about the government's ability to fulfill past commitments.[7]

Foreign Minister Bilawal Bhutto Zardari of Pakistan asked the International Monetary Fund to soften the conditions of its bailout package to help the country protect flood victims from rising prices.[8]

IMF urged Pakistan to hike its general sales tax rate to at least 18% in an effort to bolster revenue. The country's debt servicing costs are expected to surge to a high of Rs5.2 trillion in the current fiscal year. The IMF demand was made as the government shared its revised macroeconomic projections showing inflation rising to 29% and economic growth rate slowing to 1.5%, which will lead to higher unemployment and poverty in the country [9] and debt-driven rising prices, food insecurity, and a growing debt burden add to Pakistan's other challenges and no doubt Inflation is running above 38 percent annually.