Islamabad: Pakistan has retired 2.6 trillion rupees debt well before time, which is unprecedented in the country’s history.
In a post on X, Finance Minister’s Advisor Khurram Schehzad said in a historic display of fiscal discipline, the government has retired over 1.6 trillion rupees in debt to the State Bank of Pakistan within a remarkable span of just 59 days.
He said on June 30, 2025, the Ministry of Finance early-retired 500 billion rupees. Only two months later, on August 29, 2025, the Debt Management Office executed another monumental repayment of 1,133 billion rupees, which brings the total early retirement of State Bank of Pakistan debt to 1,633 billion rupees.
The Advisor said the government had earlier in the first half of the current fiscal year retired domestic commercial market debt of 1,000 billion rupees, the first such advanced debt retirement operation in Pakistan’s history.
Khurram Schehzad said including the central bank and commercial portions, the total early debt retirement in less than one year now comes to over 2.6 trillion rupees, an unprecedented scale and decisive action in the country’s fiscal history.
He said this action marks a decisive shift from past debt-heavy practices, where reliance on borrowing crowded out fiscal space and increased risks. Now, debt discipline is firmly in action. Thirty percent of State Bank of Pakistan’s debt retired early in less than two months, Pakistan cut SBP debt from 5.5 trillion to 3.8 trillion rupees, nearly 30 percent retired well before its 2029 maturity.
About reduced risks and improved fiscal space, Khurram Schehzad said early repayments eased the 2029 refinancing burden, lowered rollover risks, and created more room for development spending.
Regarding strengthened fiscal resilience, he said the average maturity of domestic debt has risen to 3.8 years from 2.7 in last fiscal year, the sharpest single-year improvement in history, and well ahead of the IMF target.
Alluding to major taxpayer savings, the Advisor said with falling rates and disciplined, early repayments, the government has already secured over 800 billion rupees in taxpayer savings this fiscal year.
Khurram Schehzad said by reversing the old cycle of unchecked borrowing and putting repayment at the center of fiscal management, Pakistan is restoring credibility, strengthening resilience, and building a more sustainable future.
