Pakistan’s external debt and liabilities have surged past $138 billion as of February 22, 2026, marking a significant economic challenge for the country. Over the past three years, interest payments on these loans have climbed by an astonishing 84%, escalating from $1.91 billion to $3.59 billion.
Detailed reports reveal that interest payments alone rose by $1.67 billion compared to 2022. Major creditors include the International Monetary Fund (IMF), World Bank, Asian Development Bank (ADB), and various commercial banks. Pakistan is currently paying interest rates as high as 8% on these loans. Additionally, Saudi Arabia and China have received interest on their safe deposits.
The financial strain is evident as Pakistan spent $13.32 billion annually on debt servicing. Last year, net external debt increased by $1.71 billion. The country borrowed $114.4 million while repaying $9.73 billion in principal. Interest payments rose, and payments on external commercial loans totaled nearly $3 billion, with $327 million in interest alone. Moreover, the IMF received $2.10 billion, including $580 million in interest.
Under the Naya Pakistan Certificates, the government paid $1.56 billion, including $188 million in interest. Payments to the ADB totaled $1.54 billion, with $615 million in interest, while the World Bank received $1.25 billion, including $419 million in interest.
Historically, Pakistan has relied on international loans to support its economic infrastructure. However, the rising costs of servicing these debts pose a significant risk to economic stability. Analysts predict that without strategic financial reforms, Pakistan may face further economic challenges, potentially leading to increased reliance on international financial aid.
Published in SouthAsianDesk, February 22nd, 2026
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