Pakistan posts strongest fiscal turnaround in decades

MG News | August 13, 2026 at 01:16 PM GMT+05:00

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August 13, 2026 (MLN): Pakistan has closed FY26 with a significant fiscal turnaround, moving from recurring fiscal stress toward stronger public finances, stability and sustainable growth.

The fiscal deficit stood at 2.6% of GDP, the lowest in 22 years, while the primary surplus reached 2.9% of GDP, the highest in at least 26 years.

The country recorded primary surpluses for three consecutive years, while the fiscal deficit improved by 5.2 percentage points in just three years.

Debt growth fell to a 20-year low, with debt-to-GDP and the interest burden also declining.

S&P upgraded Pakistan to B / Stable, recognizing stronger fiscal consolidation and improving sovereign fundamentals.

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