ISLAMABAD: Pakistan’s external debt has nearly doubled over the past decade, crossing $135 billion as the country continues to rely on loans from international financial institutions, bilateral lenders and private creditors.
The World Bank’s ‘International Debt Report 2026’ shows that Pakistan’s external debt increased from $68.67 billion in 2015 to $135.10 billion in 2025, highlighting the growing scale of its foreign debt obligations.
China is Pakistan’s largest individual creditor, with outstanding loans of $22.40 billion, according to the report.
Pakistan also owes $19.20 billion to the World Bank and has borrowed a substantial amount from the Asian Development Bank. The report’s detailed figures list the ADB debt at $16.30 billion, while another figure in the report summary puts it at $16.83 billion.
Pakistan’s total borrowing from international financial institutions stands at $56.83 billion. In addition, the country has secured $42.43 billion in loans from other countries and $7.8 billion from private creditors.
Public debt accounts for bulk of external liabilities
The World Bank report breaks down Pakistan’s external debt into three main categories.
Public and publicly guaranteed debt accounts for $107 billion of the total, while private sector external debt stands at $17.58 billion. Short-term external debt amounts to another $10.45 billion.
The average maturity period of Pakistan’s public debt is 16 years, with an average interest rate of 3.6%. The average interest rate on private sector debt, however, is significantly higher at 8.6%.
China extends repayment period
The report also highlights developments in Pakistan’s borrowing arrangements during 2025.
China extended the repayment period for $2 billion of Pakistan’s debt, providing additional time for the country to meet its obligations. During the same year, the International Monetary Fund provided Pakistan with $2.3 billion in new loans.
Global debt burden reaches record levels
The World Bank report also points to mounting debt pressures across developing economies.
External debt among developing countries reached a record $9.4 trillion, marking a 5.5% increase over the course of a year. These countries paid a combined $1.4 trillion towards debt obligations, including principal and interest, in 2025.
The debt repayment burden on developing countries has increased for the fifth consecutive year, according to the report.
Low-income countries recorded an 8.9% rise in external debt. The report also noted an increase in payments of both principal and interest to private creditors during 2025, reflecting the growing cost of servicing external borrowing.
