Karachi: Expressing grave concern over rising loans, Pasban Democratic Party (PDP) Chairman Altaf Shakoor stated that the nation must make efforts to break free from its debt trap. Reports indicate that the per person loan in Pakistan is now Rs320,000, highlighting the country’s escalating financial burden.
According to a statement by Pasban Democratic Party, every Pakistani is indebted due to the high national debt, which has been growing for years. As of September 2024, Pakistan’s total debt reached PKR 71.24 trillion, accounting for 67.2% of the country’s GDP. This comprises domestic debt of PKR 47.16 trillion and external debt of PKR 33.062 trillion.
In June 2023, the domestic debt stood at PKR 38,810 billion, while the external debt was USD 133.5 billion by September 2024. The debt-to-GDP ratio decreased from 74.8% in June 2023 to 65.7% in September 2024. Research suggests that high debt levels can negatively impact economic growth, alter expectations, and increase uncertainty, among other consequences.
Altaf Shakoor criticized the ruling elite for pursuing more loans instead of ending the debt cycle. He proposed that parliament should legislate against taking new foreign loans for the next decade. Shakoor described the debt trap as a death trap and highlighted that debt servicing, including interest payments, will consume approximately 51.8% of the total budget outlay of Rs 18.877 trillion in the financial year 2024-25.
Shakoor emphasized that agriculture could be the key to breaking this cycle. He pointed to Pakistan’s natural resources and suggested investments in new dams, canals, solar electricity, and desalination. He urged the army chief and the prime minister to establish a high-powered body to boost agriculture, similar to the SIFC, as a means to end poverty and deprivation.