External debt burden

2026-02-22 - 22:13

Our ballooning external debt and liabilities have exceeded $138b, with interest payments on these loans having surged by 84 percent over the past three years. In total, including interest, Pakistan spends $13.32b annually on debt servicing. Net external debt increased by $1.71b last year. On external commercial loans, Pakistan paid nearly $3b, including $327m in interest. These figures are not mere statistics, they rather reflect growing vulnerability of our economy and the urgent need to rethink our growth model. Reliance on foreign loans is unsustainable, both economically and strategically. To reduce this dependence, we must focus on productive sectors like agriculture, industry and IT while steering the economy toward export-led growth. Government functionaries have reiterated this repeatedly. Indeed, only through generating real economic output, fostering innovation and expanding trade can the country achieve fiscal stability and strengthen its economic sovereignty. But only lip service is not enough as this isthe time to deliver on these fronts rather than offering empty promises. Indeed the country has immense potential in different sectors and exploiting that in real sense can take the economy on upward trajectory. Achieving this requires a conducive environment for foreign investment including incentives, regulatory clarity and ease of doing business. Equally important is to engage with overseas Pakistanis, channelling their investments into sectors that fuel growth, generate employment and strengthen exports.Strategic, sustained action to enhance domestic productivity, attract investment and expand exports that can reverse dependence on foreign loans. The time to act decisively is now for the sake of economic sovereignty, stability and a sustainable future for the nation.