By the end of the last fiscal year, the per capita debt of every Pakistani rose significantly, reaching nearly Rs302,000. The government failed to adhere to the budget deficit limit set by the Fiscal Responsibility and Debt Limitation (FRDL) Act.
The federal budget deficit exceeded Rs4 trillion, double the legally allowed limit of 3.5% of GDP, reaching 7.3% or Rs7.7 trillion. This figure was slightly above the government’s target.
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According to a policy statement released by the Ministry of Finance, per capita debt rose by Rs30,690 or 11.3% during the fiscal year. The debt per person increased from Rs271,264 in FY2023 to Rs301,954 in FY2024.
Public debt saw a 15% rise, reaching Rs72.3 trillion, up from Rs62.9 trillion. This increase was primarily due to higher interest payments and currency depreciation. However, public debt as a percentage of GDP dropped from 74.8% in June 2023 to 67.2% in June 2024.
Despite inflation easing and the current account deficit remaining minimal, rising interest payments pushed government expenses 11.7% above budget estimates. Development spending was also cut, reducing the Public Sector Development Program (PSDP) allocation from Rs1.14 trillion to Rs1.03 trillion.
Economic recovery was supported by targeted subsidies, stable exchange rates, and fiscal reforms, but challenges such as high interest rates and revenue shortfalls persisted.
