Pakistan has achieved a significant milestone in economic management, recording a substantial reduction in total public debt in September 2025, according to the latest data released by the State Bank of Pakistan (SBP).
The report highlights that the government successfully lowered its total debt by Rs852 billion in September alone. As a result, the country’s total public debt stood at Rs76,605 billion at the end of the month, compared to Rs77,458 billion recorded in August 2025.
A major part of this improvement came from a notable decline in domestic borrowing. The SBP data shows that the government’s local debt decreased by Rs649 billion in a single month. Domestic debt fell from Rs54,073 billion in August to Rs53,424 billion in September 2025.
External debt also witnessed a positive downward shift. During September, the government’s external debt reduced by Rs203 billion, dropping from Rs23,385 billion in August to Rs23,181 billion in September.
The broader picture for the fiscal year’s first quarter is equally encouraging. According to figures compiled in Karachi, the government’s overall debt declined by Rs 1,283 billion during the first three months of the current financial year. This includes a reduction of Rs1,048 billion in domestic debt and Rs236 billion in external debt.
Economic analysts say the sharp decline in total debt reflects improved fiscal discipline, better cash flow management and a strengthened economic strategy geared toward stabilising Pakistan’s financial outlook.