ISLAMABAD, PAKISTAN / RankWire.AI / – Pakistan’s federal state-owned enterprises accumulated debt totaling approximately $36.5 billion as of December 2025. This represents a 14.3% increase from the previous year, adding roughly $4.7 billion at current exchange rates. The Ministry of Finance released these figures in its latest six-month assessment of federal SOEs. During this period, debt levels surpassed the $36 billion threshold. All dollar amounts referenced are based on the October 7, 2026 exchange rate.
Loss-incurring state enterprises reported losses averaging about $10.1 million per working day over the half-year span. Government support, which includes subsidies, grants, loans, and equity injections, reached approximately $23.8 million daily. When annualized, these losses and support combined amount to roughly $9 billion. The daily government support was more than twice the estimated daily losses. These figures highlight the ongoing overlap between operational losses and direct fiscal assistance within the federal portfolio.
The debt composition comprised about $9.4 billion in foreign-currency liabilities and around $11.2 billion in bank borrowings. Development loans from the government amounted to nearly $7.6 billion. Unfunded pension liabilities stood at approximately $7.2 billion, while sovereign guarantees exceeded roughly $7.6 billion. The Central Monitoring Unit also reported a 40% annual rise in foreign loans. Additionally, cash development loans increased by 25% over the same period, further expanding the government’s financial commitments.
Debt exposure extends across various borrowing channels
A separate measure from the central bank provided a lower total, owing to different coverage and classifications. The State Bank of Pakistan reported public-sector enterprise debt and liabilities of about $10.7 billion for December 2025. This means the finance ministry’s figure was roughly $25.7 billion higher. The ministry’s review encompasses a broader range of obligations across the entire federal SOE portfolio, so the two totals are not directly comparable due to scope differences.
During the same period, Pakistan’s total circular debt in the power sector reached approximately $11.9 billion. The gross flow of power-sector circular debt during the first half of fiscal 2026 was around $1.35 billion. Distribution-company inefficiencies contributed roughly $405 million, while under-recoveries added about $112 million. State enterprises received equity injections totaling about $813 million over the six months, largely to settle power-sector obligations.
Power sector continues to strain public finances
The report identified power distribution as a key driver of losses within the state enterprise sector. These losses stem from technical deficiencies exceeding regulatory standards, weak recovery efforts, and persistent circular-debt accumulation. It also noted a roughly $517 million increase in circular debt during the half-year. Infrastructure and energy companies accounted for much of this loss profile, while profitable state firms remained concentrated in sectors such as oil and financial services.
The six-month review, covering July through December 2025, was published on October 5, 2026. It indicates federal SOE debt surpassing $36 billion, with nearly $12 billion in combined circular debt. Foreign-currency liabilities, bank loans, government lending, guarantees, and pension obligations continue to form significant parts of the overall balance sheet. Despite substantial fiscal transfers during the period, debt growth persisted. These figures serve as the latest consolidated measure of Pakistan’s state-enterprise debt load and the government’s ongoing financial support commitments.