Lahore (Bloom Pakistan/Baaghi TV) – August 26, 2025: Punjab has emerged as Pakistan’s biggest borrower in the opening weeks of the fiscal year 2025-26, securing a record Rs. 405 billion from the State Bank of Pakistan (SBP) within just 38 days under the leadership of Chief Minister Maryam Nawaz.
According to official SBP data, Punjab accounted for 87.1% of the total Rs. 465 billion borrowed by all provinces between July 1 and August 8, 2025. In stark contrast, other provinces borrowed far less:
- Khyber Pakhtunkhwa: Rs. 21 billion (4.5%)
- Sindh: Rs. 16 billion (3.4%)
- Balochistan: Rs. 13 billion (2.8%)
Punjab’s borrowing is nearly 25 times higher than Balochistan’s and 20 times Sindh’s, underscoring its reliance on central bank financing to support major initiatives such as wheat procurement, subsidies, and the Apna Ghar Apni Chhat housing scheme.
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Debt Clearance Milestone
Amid this borrowing spree, Punjab simultaneously celebrated a historic milestone by clearing a decades-old wheat procurement debt of Rs. 675 billion. The province made its final repayment of Rs. 13.8 billion to the National Bank of Pakistan, saving Rs. 250 million in daily interest costs. Officials hailed this move as a “landmark achievement” that frees up billions in resources for public welfare and affordable housing.
Provincial Debt Dynamics
While Punjab leads in absolute borrowing, per capita and GDP-relative figures provide nuance:
- Punjab: Rs. 3,164 per capita, 0.65% of GDP
- Balochistan: Rs. 867 per capita, 0.23% of GDP
- Khyber Pakhtunkhwa: Rs. 512 per capita, 0.12–0.19% of GDP
- Sindh: Rs. 286 per capita, 0.05–0.06% of GDP
Sindh’s cautious borrowing highlights fiscal restraint, while Balochistan’s higher per capita reliance reflects its smaller economy and dependence on federal transfers.
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Wider Debt Burden
Despite Punjab’s repayment milestone, state-owned enterprises (SOEs) across provinces continue to struggle, with combined debts surpassing Rs. 2,166 billion. Punjab’s SOEs alone borrowed Rs. 65 billion from commercial banks to remain operational, raising fresh concerns over financial inefficiencies.
At the national level, Pakistan’s public debt hit Rs. 76,007 billion by March 2025, while provincial commodity debt stood at Rs. 1,162 billion. Although both federal and provincial governments made repayments in FY25 — including Punjab’s Rs. 28.5 billion to SBP — the new fiscal year has already seen a borrowing surge.
As Punjab pushes forward with debt-driven development under Maryam Nawaz’s administration, economists warn of the long-term fiscal challenges this pace of borrowing may create for both the province and the country.
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