Pakistan Debt Crisis and IMF Bailout: Urgent Measures for Economic Stability
Pakistan's Alarming Federal Debt Levels
Pakistan's federal government is grappling with an unprecedented debt crisis, as federal debt has surged beyond PKR 70 trillion. The latest report from the State Bank of Pakistan highlights an alarming increase of PKR 1,448 billion in just two months of the current fiscal year, with PKR 739 billion added in August alone.
Rising Domestic and External Debt
From September 2023 to August 2024, the overall debt rose by a staggering PKR 6,392 billion, where the breakdown reveals domestic debt mounting to PKR 48,339 billion and external debt reaching PKR 22,023 billion. Such dramatic increases have sparked serious concerns regarding Pakistan's fiscal health.
IMF Bailout: A Lifeline for Economic Stability
In a bid to tackle this dire economic situation, the IMF has approved a new bailout package of $7 billion for Pakistan as of September 26. This financial assistance, eagerly awaited by the finance ministry, involves the immediate disbursement of under $1.1 billion as the first loan tranche, which might be the last such loan necessary for recovery.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.