ISLAMABAD, PAKISTAN / RankWire.AI / – Pakistan’s federal state-owned enterprises (SOEs) reported total debt reaching approximately $36.5 billion at the close of December 2025. This amount represents a 14.3% increase from the previous year, adding roughly $4.7 billion at current exchange rates. The figures were published in the Ministry of Finance’s recent six-month review of federal SOEs. During this period, debt levels crossed the $36 billion threshold. All dollar figures are based on the October 7, 2026 exchange rate.
During the six months, loss-making state enterprises incurred losses averaging about $10.1 million each business day. Meanwhile, government interventions through subsidies, grants, loans, and equity injections amounted to approximately $23.8 million daily. When annualized, these losses and support measures combined to roughly $9 billion, with daily government support more than doubling the estimated daily losses. The data highlight the ongoing overlap between operating deficits and direct fiscal assistance within the federal portfolio.
The composition of debt included around $9.4 billion in liabilities denominated in foreign currencies and roughly $11.2 billion in bank borrowings. Additionally, cash development loans from the government stood near $7.6 billion. Unfunded pension liabilities were estimated at about $7.2 billion, while sovereign guarantees exceeded roughly $7.6 billion. The Central Monitoring Unit also noted a 40% annual rise in foreign loans. Over the same period, cash development loans grew by 25%, further increasing the government’s financial exposure.
Debt exposure spans multiple borrowing channels
A separate measure from the central bank reported a significantly lower total debt figure due to different scope and classifications. The State Bank of Pakistan indicated public-sector enterprise debt and liabilities of about $10.7 billion as of December 2025. This means the Ministry of Finance’s figure is roughly $25.7 billion higher. The ministry’s assessment encompasses a broader range of obligations across the entire federal SOE portfolio, making direct comparisons between the two totals inappropriate.
Pakistan’s total circular debt within the power sector reached approximately $11.9 billion during the same period. In the first half of fiscal 2026, power-sector circular debt flows amounted to about $1.35 billion. Distribution company inefficiencies contributed roughly $405 million, while under-recoveries accounted for around $112 million. During the six months, equity injections into state enterprises increased to about $813 million, much of which was allocated to settling power-sector liabilities.
Power sector remains a significant strain on public finances
The report identified power distribution as a primary source of losses within the state-enterprise sector, attributing these to technical shortfalls exceeding regulatory standards, weak recovery efforts, and persistent circular-debt buildup. It also recorded an approximate $517 million rise in circular-debt stock during the period. Infrastructure and energy companies represented much of this loss profile, while profitable state entities remained concentrated in sectors such as oil and financial services.
The six-month review, covering July through December 2025 and published on October 5, 2026, confirms that federal SOE debt exceeds $36 billion, with nearly $12 billion in total circular debt. The balance sheet remains heavily influenced by foreign-currency liabilities, bank loans, government lending, guarantees, and pension commitments. Despite significant fiscal transfers during this period, debt levels continued to grow. These figures serve as the latest consolidated snapshot of Pakistan’s state-enterprise debt burden and the government’s ongoing financial support efforts.