ISLAMABAD - Pakistan has planned to borrow $23.38 billion under foreign economic assistance during the next fiscal year 2026-27 to maintain its foreign exchange reserves and repay previous loans. The amount of foreign borrowing for the next fiscal year is 17.5 percent higher than the estimates of the outgoing fiscal year, in which the government had projected to borrow $19.9 billion under foreign economic assistance during FY2025-26.
Breakdown of Borrowing Sources
The breakup of $23.38 billion shows that Pakistan will borrow $400 million from bilateral sources, $4.866 billion from multilateral sources, $2 billion from foreign commercial banks, $2.35 billion from other commercial banks, $12 billion in bilateral deposits, $1.122 billion from Naya Pakistan Certificates, and $530 million from the International Monetary Fund (IMF) during the upcoming financial year, according to the budget documents.
Multilateral Sources
In multilateral sources, the country will receive $1.68 billion from the Asian Development Bank (ADB), $86.337 million from AIIB, $412.019 million from IBRD, $1.434 billion from IDA of the World Bank, $39.758 million from IFAD, $186.64 million from IsDB, $1 billion from IsDB (short-term), and $8.769 million from OPEC funds.
Bilateral Sources
In bilateral sources, the government has budgeted $97.641 million from China, $50 million from Denmark, $94.315 million from France, $10.894 million from Germany, $0.89 million from Italy, $15.945 million from Japan, $29.224 million from Korea, $20.641 million from Kuwait, $5.32 million from Oman, $23.889 million from the USA, $47.182 million from Saudi Arabia, and $4.483 million from block allocation for the next fiscal year.
Debt Servicing Costs
Meanwhile, the country will spend around Rs8.051 trillion on debt servicing, including interest payments and retiring principal amounts, during the next financial year 2026-27. This amounts to 42.89 percent of the total budget outlay of Rs18.771 trillion. The government has earmarked Rs8.054 trillion in the budget 2026-27 against Rs8.206 trillion for the current fiscal year.
Public Debt Figures
The country is continuously borrowing; Pakistan's total public debt stood at Rs83.285 trillion by the end of March. Domestic debt has reached Rs57.6 trillion, and external debt has reached Rs25.7 trillion ($92.2 billion), according to the latest Economic Survey 2025-26. Growth in public debt outstanding during the first nine months of FY2026 stood at 3.4 percent, which is lower compared to the growth of 6.7 percent in the same period of the preceding year.
