Pakistan External Debt Nearly Doubles in a Decade to $135 Billion, World Bank Says
File photo: The World Bank Group headquarters in Washington, DC — the figures are from the Bank's International Debt Report 2026
Pakistan external debt nearly doubled over the decade ending in 2025, reaching $135.1 billion, the World Bank says in its International Debt Report 2026. The report puts the stock at $68.673 billion in 2015 and $135.107 billion in 2025 — a rise of almost 97 per cent in ten years, driven by fresh borrowing from official lenders and a return of private creditors to developing-country markets.
China is Pakistan’s largest single creditor
China is Pakistan’s largest individual creditor, with $22.4 billion outstanding, followed by the World Bank itself at $19.2 billion and the Asian Development Bank at $16.83 billion. Of the total, public and publicly guaranteed debt stood at $107.076 billion, private non-guaranteed debt at $17.58 billion and short-term debt at $10.45 billion. Multilateral lenders held $56.83 billion of the public and publicly guaranteed stock, bilateral creditors $42.43 billion and private creditors $7.8 billion. Loans from official creditors carried an average maturity of 16 years, with a four-year grace period and an average interest rate of 3.6 per cent. Private credit was far costlier — 8.6 per cent on average, repayable over three years with only a year of grace.
Help from Beijing and the IMF in 2025
The report notes that China extended the maturities on $2 billion of loans to Pakistan during 2025, while the International Monetary Fund provided $2.3 billion in new disbursements under its Extended Fund Facility and Resilience and Sustainability Facility arrangements to support the country’s long-term economic stability. Across the Middle East, North Africa, Afghanistan and Pakistan region, the external debt-to-gross national income ratio rose from 26.7 per cent to 29.4 per cent in 2025 — the largest single-year increase of any region, pointing to continued debt accumulation.
Borrowing at a record high worldwide
Globally, external debt across low- and middle-income countries climbed 5.5 per cent to a record $9.4 trillion in 2025, the sharpest increase in four years, as bond issuance rebounded and the dollar weakened. Debt service payments rose for a fifth consecutive year, up 1.9 per cent to $1.4 trillion, and the report warns that the countries least able to pay are facing some of their highest borrowing costs in decades, with private lenders charging far more than official creditors.
