Pakistan's external debt servicing surges to $10bn in Q4FY26

August 11, 2026 (MLN): Pakistan's external debt servicing surged to $10.14bn in the fourth quarter of fiscal year 2026, up sharply from $3.86bn in the preceding quarter, according to data released by the State Bank of Pakistan (SBP).

The increase, of roughly 2.63x quarter-on-quarter, was driven primarily by a jump in principal repayments, which rose to $8.81bn in Q4 from $2.70bn in Q3.

Interest payments also edged higher, climbing to $1.33bn from $1.15bn over the same period.

Servicing of public debt, which includes government obligations, IMF repayments and foreign exchange liabilities, rose to $9.37bn in Q4 from $3.30bn in Q3.

Within this, government debt repayments nearly doubled to $5.61bn in Q4 from $2.87bn in Q3, with principal payments rising to $4.75bn from $2.24bn and interest payments climbing to $864mn from $632mn.

Repayments to the International Monetary Fund eased to $202mn in Q4 from $288mn in Q3, as principal payments fell to $78mn from $171mn, even as interest payments rose to $124mn from $117mn.

Foreign exchange liabilities servicing recorded the sharpest increase, surging to $3.56bn in Q4 from just $146mn in Q3, driven almost entirely by a jump in principal repayments to $3.45bn from nil in the previous quarter.

Debt servicing by public sector enterprises (PSEs) eased to $90mn in Q4 from $177mn in Q3.

Guaranteed debt repayments fell to $71mn from $177mn, while non-guaranteed debt servicing, which recorded no outflows in Q3, rose to $19mn in Q4.

Bank borrowings remained negligible, edging up marginally to $14mn in Q4 from $13mn in the previous quarter.

Private sector external debt servicing rose to $662mn in Q4, up from $362mn in Q3, driven by higher principal repayments on non-guaranteed debt, which climbed to $469mn from $202mn, and interest payments, which rose to $193mn from $159mn. As in the prior quarter, no servicing was recorded under guaranteed private sector debt.

For the full fiscal year 2026, Pakistan's total external debt servicing stood at $21.59bn, comprising principal repayments of $16.59bn and interest payments of $bn.

Of this, public debt servicing accounted for $18.90bn, including $13.95bn in government debt repayments, $1.05bn in IMF repayments and $3.89bn in foreign exchange liabilities servicing.

PSEs serviced $553mn in debt over the year, bank borrowings amounted to $64mn, and private sector external debt servicing totalled $2.08bn.

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