Pakistan Extends Debt Maturity to 2028
Pakistan Plans to Extend Debt Maturity Periods to Ease Financing Pressure
Officials have revealed a new plan to extend the average maturity period of Pakistan’s debt in an effort to reduce future financing needs. Under the proposal, the average maturity of domestic debt will increase from the current 3 years and 8 months to 52 months, while external debt maturity will be extended from 6.1 years to 76 months.
The International Monetary Fund (IMF) has set 2028 as the target year for Pakistan to fully implement these new maturity goals.
According to sources familiar with the plan, stretching out the maturity periods will help the country lower its financing requirements in the coming years, improving fiscal stability.
An implementation report on this plan will be submitted to the IMF ahead of Pakistan’s next economic review. The policy is expected to begin rolling out within the current fiscal year.
The updated debt management framework also calls for around 30% of domestic loans to be issued at a fixed policy rate. Furthermore, the share of Shariah-compliant debt is planned to increase to 20% over the next three years.
In addition, the volume of external debt will be capped at a maximum of 40% of Pakistan’s total public debt, according to sources.
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