Pakistan repays Rs1.2 trillion debt to SBP before maturity

The government has repaid Rs1.2 trillion in domestic debt owed to the State Bank of Pakistan (SBP) ahead of its scheduled maturity, marking the largest single early repayment tranche recorded so far.

ISLAMABAD: The government has repaid Rs1.2 trillion in domestic debt owed to the State Bank of Pakistan (SBP) ahead of its scheduled maturity, marking the largest single early repayment tranche recorded so far.

Finance Minister’s Adviser Khurram Schehzad said the latest repayment has taken the total domestic debt retired before maturity to more than Rs5.92 trillion.

According to Schehzad, the latest repayment also surpassed the previous record of Rs1.133 trillion made in August 2025, highlighting the government’s increasing focus on proactive public debt management.

Pakistan has been making early repayments of domestic debt in a series of transactions since October 2024. The repayments included Rs826 billion in October 2024, Rs200 billion in November 2024, Rs273 billion in March 2025, Rs500 billion in June 2025 and Rs1.133 trillion in August 2025.

Further repayments included Rs122 billion in November 2025, Rs494 billion in December 2025, Rs300 billion in January 2026, Rs595 billion in April 2026, Rs279 billion in May 2026 and Rs1.2 trillion in August 2026.

Schehzad said the pace of early debt retirement had accelerated considerably. Pakistan retired Rs1.8 trillion ahead of maturity during fiscal year 2025, followed by Rs2.9 trillion in FY2026, representing an increase of around 62%.

A further Rs1.2 trillion has already been retired ahead of maturity during FY2027, he added.

The finance adviser said the development reflected a shift towards more active sovereign liability management, with improved fiscal space being used to settle debt obligations before their scheduled maturity.

He said the strategy could help reduce refinancing and rollover risks, ease future debt-servicing pressures and strengthen Pakistan’s overall public debt position.

Schehzad added that Pakistan was increasingly moving beyond simply managing debt maturities and was instead taking steps to strengthen the country’s sovereign balance sheet through proactive debt management.