New Delhi, Nov 8 (IANS) Pakistan’s external debt has nearly doubled over the past decade, climbing to $135.1 billion in 2025 from $68.7 billion in 2015, according to the World Bank’s International Debt Report 2026.

The country's external debt increased by around 4 per cent from $129.9 billion in 2024, according to The Khaama Press News Agency.

Of the total external debt, $107.08 billion comprised public and publicly guaranteed obligations, while private-sector borrowing without government guarantees stood at $17.58 billion. Short-term external debt accounted for another $10.45 billion.

Multilateral institutions constituted the largest source of public and publicly guaranteed lending, accounting for $56.83 billion, while bilateral creditors held $42.43 billion in outstanding claims.

China remained Pakistan’s largest individual country creditor, with outstanding loans of approximately $22.4 billion. Pakistan also owed around $19.2 billion to the World Bank and $16.83 billion to the Asian Development Bank, as per the report.

The report also highlighted the substantial difference in borrowing costs between official and private creditors. New financing commitments from official creditors in 2025 carried an average interest rate of 3.6 per cent, with an average repayment period of 16 years and a grace period of four years.

In comparison, new private-sector loans carried an average interest rate of 8.6 per cent, with an average maturity of just three years and a grace period of one year.

Pakistan’s external debt-to-gross national income (GNI) ratio stood at 34 per cent in 2025, while debt-servicing payments consumed 33 per cent of its export earnings, the report stated.

During the year, China extended the maturity of approximately $2 billion in loans to Pakistan, providing additional repayment flexibility. Meanwhile, the International Monetary Fund (IMF) disbursed $2.3 billion under its Extended Fund Facility (EFF) and Resilience and Sustainability Facility (RSF) programmes.

The World Bank report also pointed to rising external debt vulnerabilities across the broader Middle East, North Africa, Afghanistan and Pakistan (MENAAP) region. The region's external debt-to-GNI ratio increased to 29.4 per cent in 2025 from 26.7 per cent a year earlier, marking the largest annual increase among the World Bank's regional groupings.

--IANS

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