The International Monetary Fund has projected Pakistan’s gross external financing requirements at $19.398 billion, equivalent to 4.6% of gross domestic product, for the fiscal year 2025-26.
In its report, the Fund estimated external financing needs at $19.123 billion for 2026-27 and stated that the ongoing Extended Fund Facility is fully financed, with firm commitments secured for the next 12 months and prospects for the remainder of the programme.
The Fund projected external debt to rise to $130.704 billion in the next fiscal year, up from an estimated $125.612 billion in the current year.
The IMF said progress has been made in securing financing commitments agreed ahead of the EFF request, including support from the Saudi Development Fund and China EXIM Bank.
It added that major international financial institutions now expect to provide higher financing in fiscal year 2026 than previously projected, which would help manage flood-related balance of payments pressures. The outlook for new commercial financing has also improved.
The report noted that key bilateral partners remain committed to rolling over existing short-term liabilities during the remaining programme period.
It further stated that the authorities have initiated discussions on several potential new commercial financing facilities that could be pursued if external financing requirements increase further.
The report also projects Pakistan’s domestic debt to increase by about Rs4.5 trillion to Rs63.966 trillion in the 2026-27 financial year, compared with a projected Rs59.404 trillion for the current fiscal year.
According to IMF, the domestic debt is expected to stand at 47.1% of gross domestic product in the current year before declining to 45.5% of GDP in the next fiscal year.
Pakistani authorities have committed to strengthening liability management to reduce debt-related risks. The IMF said consistent implementation of the 2026–28 Debt Management Strategy will be important to extend debt maturities and lower exposure to short-term interest rates over the medium term.
The authorities told the Fund that, in line with fiscal commitments, windfall dividends received from the State Bank of Pakistan have been used to retire domestic debt, including Rs1.133 trillion in Pakistan Investment Bonds held by the central bank.
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